House Wants to Change Rules on Agency Guidance as Senate Rolls Some Back
Representatives Sean Duffy (R- WI) and Ed Perlmutter (D- CO) announced a bipartisan bill that would clarify how the Consumer Financial Protection Bureau (CFPB) issues guidance on consumer laws. House Resolution 5534, also called the Give Useful Information to Define Effective (GUIDE) Compliance Act, would limit CFPB guidance that is “necessary or appropriate to carry out the purpose of the laws.”
Beyond dictating a content standard for agency guidance, the law also defines what types of agency materials (like bulletins and FAQs) constitute guidance, creates limits on liability for covered persons acting in good faith on agency guidance, establishes timeframes by which the Bureau must respond to requests for guidance.
In a press release accompanying the GUIDE Compliance Act, Rep. Duffy said, “The American people deserve a government that The CFPB has historically ignored requests for guidance and clarification from American businesses, consumers, and Congress – especially in relation to the Know Before You Owe rule. That’s why I’m proud to sponsor bipartisan legislation to bring predictability and transparency to the CFPB’s rule-making process. The CFPB should focus on its mission to actually protect consumers rather than play ‘gotcha’ with ambiguous and surprising guidance for mortgage lenders.”
HR 5534 comes at a time in which Congress is scrutinizing guidance issued by the CFPB back in 2013. The Government Accountability Office ruled in December that guidance provided by the CFPB on discriminatory car loan practices rose to the level of rulemaking. This opened the agency’s guidance to legislative revision via the Congressional Review Act.
Congress has been extremely active using the CRA over the past year to claw back a number of rules promulgated by the CFPB. Last year, Congress repealed the CFPB’s rule banning mandatory arbitration clauses, albeit by a very slim margin. More recently, Senator Lindsey Graham (R- SC) introduced a joint resolution to repeal the CFPB’s Payday Rule.
