CFPB Launches Pilot Advisory Opinion Program
Last week, the Consumer Financial Protection Bureau launched a pilot advisory opinion (AO) program to better assess regulatory uncertainty with current regulations. The proposed program adds to previous efforts to improve the Bureau’s guidance process, recognizing the benefit from more expansive clarifications to the public instead of only to requesting entities.
“The primary purpose of the Proposed AO Program is to provide a mechanism through which the Bureau may more effectively carry out its statutory purposes and objectives by better enabling compliance in the face of regulatory uncertainty,” the proposal reads.
Under the pilot program, the CFPB will identify outdated and unnecessary regulations to reduce burdens. It will also allow entities to present requests to clarify any uncertainty, and responses that highlight the program’s priorities will be made accessible to the public in a timely manner.
To protect consumers, the pilot AO will ensure that markets for financial products and services function carefully and transparently. The Bureau will promote fair competition by routinely and justly enforcing Federal consumer financial law.
Many have advocated for the pilot AO as a solution to ongoing ambiguity and interpretive issues that have not yet been addressed in the Bureau. If it is considered appropriate, the CFPB will launch an advisory opinion on the presented facts for other entities that would be published in the Federal Register and posted on the CFPB’s website.
Additionally, the CFPB has announced that the public may comment on the pilot AO program. After the pilot, the CFPB will review the comments and fully implement the proposed program.