On January 27, 2020, the Consumer Financial Protection Bureau (“CFPB” or “Bureau”) published a policy statement announcing a new designation for CFPB guidance, known as “Compliance Aids,” and explaining the legal status and effect of any Bureau guidance labeled as such (the “Policy Statement”).
CFPB Policy Statement
The Policy Statement announces the Bureau’s intent to establish a new category of materials similar to prior compliance resources, but which will now be designated as Compliance Aids. The Bureau noted that Compliance Aids “will provide the public with greater clarity regarding the legal status and role of these materials.” The Policy Statement does not alter the status of CFPB materials that were previously issued, but the Bureau indicated that it may reissue certain existing materials as Compliance Aids “if it is in the public interest and as Bureau resources permit.”
Notably, the Policy Statement provides that the Bureau does “not intend to use Compliance Aids to make decisions that bind regulated entities.” Rather, Compliance Aids “present the requirements of existing rules and statutes in a manner that is useful for compliance professionals, other industry stakeholders, and the public” and “may also include practical suggestions for how entities might choose to go about complying with those rules and statutes.” However, the Bureau acknowledges that Compliance Aids may not address all situations and that where there are multiple approaches to compliance that are permitted by the applicable rules and statutes, an entity can make its own business decisions regarding which method to use, which may involve methods not addressed in a Compliance Aid. While entities are not required to comply with Compliance Aids, such aids are designed to accurately summarize and illustrate the underlying rules and statutes. Accordingly, the Bureau indicated that in exercising its enforcement and supervisory discretion, it does not intend to sanction, or ask a court to sanction, entities that reasonably rely on Compliance Aids.
We applaud the Bureau for recognizing that enforcement should be based on compliance with applicable statutes and regulations. Since its inception, the Bureau has provided guidance to the industry through a variety of means. The Policy Statement provides a list of examples, including small entity compliance guides, instructional guides for disclosure forms, executive summaries, summaries of regulation changes, factsheets, and compliance checklists. Notably missing from the Bureau’s list are compliance bulletins, through which the Bureau has previously provided its interpretation of certain statutes and/or regulations within its purview. While the Bureau does not specify what categories of guidance would receive a Compliance Aid designation moving forward, it noted that it may reissue prior guidance as a Compliance Aid. It will be interesting to see whether this list of examples is a signal of the types of resources that the Bureau may reissue as Compliance Aids.