Rescission of Statement of Policy on Supervisory and Enforcement Practices Regarding Electronic Credit Card Disclosures in Light of the COVID-19 Pandemic, 17698-17699 [2021-06970]
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17698
Federal Register / Vol. 86, No. 64 / Tuesday, April 6, 2021 / Rules and Regulations
regarding the Bureau’s general plans to
exercise its supervision and
enforcement discretion and does not
impose any legal requirements on
external parties or create or confer any
substantive rights on external parties
that could be enforceable in any
administrative or civil proceedings. No
notice of proposed rulemaking was
originally required in issuing the
Statement, and it is not required in
issuing this rescission. The Regulatory
Flexibility Act also does not require an
initial or final regulatory flexibility
analysis for this rescission. The Bureau
has also determined that the rescission
of the Statement does not impose any
new or revise any existing
recordkeeping, reporting, or disclosure
requirements on covered entities or
members of the public that would be
collections of information requiring
approval by the Office of Management
and Budget under the Paperwork
Reduction Act.
Dated: March 29, 2021.
David Uejio,
Acting Director, Bureau of Consumer
Financial Protection.
[FR Doc. 2021–06969 Filed 4–5–21; 8:45 am]
BILLING CODE 4810–AM–P
BUREAU OF CONSUMER FINANCIAL
PROTECTION
12 CFR Part 1026
Rescission of Statement of Policy on
Supervisory and Enforcement
Practices Regarding Electronic Credit
Card Disclosures in Light of the
COVID–19 Pandemic
Bureau of Consumer Financial
Protection.
ACTION: Rescission of statement of
policy.
AGENCY:
The Bureau of Consumer
Financial Protection (Bureau) is
rescinding the Statement on
Supervisory and Enforcement Practices
Regarding Electronic Credit Card
Disclosures in Light of the COVID–19
Pandemic.
SUMMARY:
This rescission is applicable on
April 1, 2021.
FOR FURTHER INFORMATION CONTACT:
Zixta Q. Martinez, Division of
Supervision, Enforcement, and Fair
Lending, at (202) 435–7204. If you
require this document in an alternative
electronic format, please contact CFPB_
Accessibility@cfpb.gov.
SUPPLEMENTARY INFORMATION: On June 3,
2020, the Bureau issued a statement
entitled, ‘‘Statement on Supervisory and
khammond on DSKJM1Z7X2PROD with RULES
DATES:
VerDate Sep<11>2014
17:01 Apr 05, 2021
Jkt 253001
Enforcement Practices Regarding
Electronic Credit Card Disclosures in
Light of the COVID–19 Pandemic’’
(Statement), regarding the Bureau’s
exercise of its supervisory and
enforcement discretion under the Truth
in Lending Act (TILA) (15 U.S.C. 1601
et seq.) as implemented by Regulation Z
(12 CFR part 1026).1 The Statement
provided that under specified
circumstances, the Bureau did not
intend to cite a violation in an
examination or bring an enforcement
action against an issuer that during a
phone call does not obtain a consumer’s
E-Sign consent to electronic provision of
certain written disclosures required by
Regulation Z (12 CFR part 1026), so long
as the issuer during the phone call
obtains both the consumer’s oral
consent to electronic delivery of the
written disclosures and oral affirmation
of his or her ability to access and review
the electronic written disclosures.
Specifically, the Statement pertained to
oral telephone interactions where a card
issuer may seek to open a new credit
card account for a consumer, provide
certain temporary reductions in APRs or
fees applicable to an existing account, or
offer a low-rate balance transfer.
The Bureau hereby rescinds, as of
April 1, 2021, the Statement and
announces its intent to exercise its
supervisory and enforcement authority
consistent with the Dodd-Frank Act and
with the full authority afforded by
Congress consistent with the statutory
purpose and objectives of the Bureau.
The Statement expressed the Bureau’s
understanding that as a result of the
COVID–19 pandemic some credit card
issuers were receiving far more phone
calls from consumers than usual while
also operating with reduced staffing or
servicing capability. In particular,
consumers in many instances were
reaching out to issuers seeking relief
that issuers sometimes could not
provide without first providing certain
written disclosures required by
Regulation Z. The Bureau has
concluded that since release of the
Statement such circumstances have
changed. Since March 2020 and over the
course of the pandemic, financial
institutions, including credit card
issuers, have adjusted operations by, for
example, shifting to a remote mode of
operation and enhancing remote
operational capabilities. As States and
jurisdictions have rescinded and
modified stay-at-home orders over the
course of the pandemic, the Bureau has
learned that many financial services
entities have resumed some level of in1 https://files.consumerfinance.gov/f/documents/
cfpb_e-sign-credit-card_statement_2020-06.pdf.
PO 00000
Frm 00008
Fmt 4700
Sfmt 4700
person operations and, in many
instances combined with enhanced
remote capabilities, have demonstrated
improved business continuity.
Specifically, once States and
jurisdictions rescinded and modified
stay-at-home orders, service
representatives of credit card issuers
regained access to certain operational
systems that could not be accessed
remotely and could resume
responsiveness to consumer calls about
(1) opening a new credit card account
for a consumer, (2) providing certain
temporary reductions in APRs or fees
applicable to an existing account, or (3)
offering a low-rate balance transfer.
Based on the Bureau’s market
monitoring, the Bureau also notes that
consumers have accelerated their
transition from traditional call
communications to digital means as the
pandemic has progressed. Therefore,
due to the noted adjustments by credit
card issuers and communication
migration from traditional calls to
digital means by consumers, the
temporary and targeted flexibility
provided by the Statement is no longer
warranted.
Based on the Bureau’s market
monitoring, the Bureau believes that
credit card issuers have adapted and
improved operations over the course of
the pandemic and are now able to
respond to the credit needs of
consumers while still providing
consumers with the full protections
afforded by TILA and Regulation Z
without the flexibility afforded under
the Statement. The Bureau notes that
many credit card issuers are now
choosing not to take advantage of the
flexibility provided by the Statement
due to improved operational capabilities
that enable the provision of written
disclosures. In addition, because the
Statement did not create binding legal
obligations on the Bureau or create or
confer any substantive rights on external
parties, it did not create any reasonable
reliance interests for industry
participants. The Bureau never intended
the Statement to be permanent, and the
Statement expressly indicated that the
relief was intended to be temporary and
targeted.
The Bureau continues to encourage
institutions to meet the financial
services needs of their customers
affected by the COVID–19 pandemic.
As the pandemic continues to unfold,
consumers are struggling and
compliance with consumer law has
never been more important. The
Bureau’s statutory purposes include
‘‘ensuring . . . that markets for
consumer financial products and
services are fair, transparent, and
E:\FR\FM\06APR1.SGM
06APR1
Federal Register / Vol. 86, No. 64 / Tuesday, April 6, 2021 / Rules and Regulations
khammond on DSKJM1Z7X2PROD with RULES
competitive.’’ 12 U.S.C. 5511(a).
Declining to cite conduct that is a
violation of TILA and Regulation Z
based on the articulated principles in
the Statement may skew the consumer
financial marketplace, to the detriment
of market participants who provide
written disclosures in accordance with
TILA and Regulation Z while
demonstrating an ability to quickly
assist consumers and respond to the
credit needs of consumers during the
pandemic. To fulfill its statutory
mandate, the Bureau has made it a
priority to direct its supervisory,
enforcement, and other tools to ensure
that consumers are afforded full
protection under the law. It is therefore
more important than ever that financial
institutions will adhere to the consumer
protection requirements of TILA and
Regulation Z in their interactions with
consumers and that the Bureau use its
supervisory and enforcement tools to
the full extent and with the full
flexibility afforded by Congress.
The Bureau hereby rescinds, as of
April 1, 2021, its Statement on
Supervisory and Enforcement Practices
Regarding Electronic Credit Card
Disclosures in Light of the COVID–19
Pandemic and instructs all financial
institutions, including credit card
issuers, to comply with their obligations
under TILA (15 U.S.C. 1601 et seq.) as
implemented by Regulation Z (12 CFR
part 1026). Instead, in its discretion, the
Bureau intends to exercise its
supervisory and enforcement authority
consistent with the Dodd-Frank Act and
with the full authority afforded by
Congress consistent with the statutory
purpose and objectives of the Bureau.
The Bureau does not intend to cite in an
examination or initiate an enforcement
action against any entity that did not
comply with the TILA and Regulation Z
written disclosure requirements as
described in the Statement between
June 3, 2020, and April 30, 2021.
Regulatory Requirements
The Statement constituted a general
statement of policy exempt from the
notice and comment rulemaking
requirements of the Administrative
Procedure Act (APA). It was intended to
provide information regarding the
Bureau’s general plans to exercise its
supervisory and enforcement discretion
and did not impose any legal
requirements on external parties, nor
did it create or confer any substantive
rights on external parties that could be
enforceable in any administrative or
civil proceeding. This rescission
likewise is a general statement of policy
exempt from the notice and comment
rulemaking requirements of the APA. It
VerDate Sep<11>2014
17:01 Apr 05, 2021
Jkt 253001
is intended to provide information
regarding the Bureau’s general plans to
exercise its supervision and
enforcement discretion and does not
impose any legal requirements on
external parties or create or confer any
substantive rights on external parties
that could be enforceable in any
administrative or civil proceedings. No
notice of proposed rulemaking was
originally required in issuing the
Statement, and it is not required in
issuing this rescission. The Regulatory
Flexibility Act also does not require an
initial or final regulatory flexibility
analysis for this rescission. The Bureau
has also determined that the rescission
of the Statement does not impose any
new or revise any existing
recordkeeping, reporting, or disclosure
requirements on covered entities or
members of the public that would be
collections of information requiring
approval by the Office of Management
and Budget under the Paperwork
Reduction Act.
Dated: March 29, 2021.
David Uejio,
Acting Director, Bureau of Consumer
Financial Protection.
[FR Doc. 2021–06970 Filed 4–5–21; 8:45 am]
BILLING CODE 4810–AM–P
BUREAU OF CONSUMER FINANCIAL
PROTECTION
12 CFR Chapter X
Rescission of Statement of Policy on
Bureau Supervisory and Enforcement
Response to COVID–19 Pandemic
Bureau of Consumer Financial
Protection.
ACTION: Rescission of statement of
policy.
AGENCY:
The Bureau of Consumer
Financial Protection (Bureau) is
rescinding the Statement on Bureau
Supervisory and Enforcement Response
to COVID–19 Pandemic.
DATES: This rescission is applicable on
April 1, 2021.
FOR FURTHER INFORMATION CONTACT:
Mehul Madia, Division of Supervision,
Enforcement, and Fair Lending, at (202)
435–7104. If you require this document
in an alternative electronic format,
please contact CFPB_Accessibility@
cfpb.gov.
SUMMARY:
On March
26, 2020, the Bureau issued a statement
entitled, ‘‘Statement on Bureau
Supervisory and Enforcement Response
to COVID–19 Pandemic’’ (Statement),
regarding the Bureau’s exercise of its
SUPPLEMENTARY INFORMATION:
PO 00000
Frm 00009
Fmt 4700
Sfmt 4700
17699
supervisory and enforcement discretion
during the pandemic.1 Specifically, the
Statement provided that the Bureau
would take into account staffing and
related resource challenges confronting
financial institutions and their counsel
as they relate to supervisory activities
and enforcement actions. The Statement
also noted that when conducting
examinations and other supervisory
activities and in determining whether to
take enforcement action, the Bureau will
consider the circumstances that entities
may face as a result of the COVID–19
pandemic and will be sensitive to goodfaith efforts demonstrably designed to
assist consumers.
The Bureau hereby rescinds, as of
April 1, 2021, the Statement and
announces its intent to exercise its
supervisory and enforcement authority
consistent with the Dodd-Frank Act and
with the full authority afforded by
Congress consistent with the statutory
purpose and objectives of the Bureau.
The Statement expressed the Bureau’s
recognition of the impact of the COVID–
19 pandemic on the operations of many
financial institutions, including staffing
and related resource challenges
confronting financial institutions and
their counsel. The Bureau has
concluded that since release of this
statement such circumstances have
changed. Since March 2020 and over the
course of the COVID–19 pandemic,
financial institutions and other entities
that provide financial services and
products to consumers have adjusted
operations by, for example, shifting to a
remote mode of operation. As States and
other jurisdictions have rescinded and
modified stay-at-home orders over the
course of the pandemic, many financial
services entities have resumed some
level of in-person operations and, in
many instances combined with more
robust remote capabilities, have
demonstrated improved business
continuity.
With regard to the temporary
flexibility announced in the Statement,
the Bureau believes that companies
should have had sufficient time to adapt
to the pandemic and should now be able
adequately to comply with the law and
respond to enforcement actions or
supervisory activities without the
flexibility afforded under the statement.
In addition, because the Statement did
not create binding legal obligations on
the Bureau or create or confer any
substantive rights on external parties, it
did not create any reasonable reliance
interests for industry participants.
1 https://files.consumerfinance.gov/f/documents/
cfpb_supervisory-enforcement-statement_covid-19_
2020-03.pdf.
E:\FR\FM\06APR1.SGM
06APR1
Agencies
[Federal Register Volume 86, Number 64 (Tuesday, April 6, 2021)]
[Rules and Regulations]
[Pages 17698-17699]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-06970]
-----------------------------------------------------------------------
BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1026
Rescission of Statement of Policy on Supervisory and Enforcement
Practices Regarding Electronic Credit Card Disclosures in Light of the
COVID-19 Pandemic
AGENCY: Bureau of Consumer Financial Protection.
ACTION: Rescission of statement of policy.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is
rescinding the Statement on Supervisory and Enforcement Practices
Regarding Electronic Credit Card Disclosures in Light of the COVID-19
Pandemic.
DATES: This rescission is applicable on April 1, 2021.
FOR FURTHER INFORMATION CONTACT: Zixta Q. Martinez, Division of
Supervision, Enforcement, and Fair Lending, at (202) 435-7204. If you
require this document in an alternative electronic format, please
contact [email protected].
SUPPLEMENTARY INFORMATION: On June 3, 2020, the Bureau issued a
statement entitled, ``Statement on Supervisory and Enforcement
Practices Regarding Electronic Credit Card Disclosures in Light of the
COVID-19 Pandemic'' (Statement), regarding the Bureau's exercise of its
supervisory and enforcement discretion under the Truth in Lending Act
(TILA) (15 U.S.C. 1601 et seq.) as implemented by Regulation Z (12 CFR
part 1026).\1\ The Statement provided that under specified
circumstances, the Bureau did not intend to cite a violation in an
examination or bring an enforcement action against an issuer that
during a phone call does not obtain a consumer's E-Sign consent to
electronic provision of certain written disclosures required by
Regulation Z (12 CFR part 1026), so long as the issuer during the phone
call obtains both the consumer's oral consent to electronic delivery of
the written disclosures and oral affirmation of his or her ability to
access and review the electronic written disclosures. Specifically, the
Statement pertained to oral telephone interactions where a card issuer
may seek to open a new credit card account for a consumer, provide
certain temporary reductions in APRs or fees applicable to an existing
account, or offer a low-rate balance transfer.
---------------------------------------------------------------------------
\1\ https://files.consumerfinance.gov/f/documents/cfpb_e-sign-credit-card_statement_2020-06.pdf.
---------------------------------------------------------------------------
The Bureau hereby rescinds, as of April 1, 2021, the Statement and
announces its intent to exercise its supervisory and enforcement
authority consistent with the Dodd-Frank Act and with the full
authority afforded by Congress consistent with the statutory purpose
and objectives of the Bureau.
The Statement expressed the Bureau's understanding that as a result
of the COVID-19 pandemic some credit card issuers were receiving far
more phone calls from consumers than usual while also operating with
reduced staffing or servicing capability. In particular, consumers in
many instances were reaching out to issuers seeking relief that issuers
sometimes could not provide without first providing certain written
disclosures required by Regulation Z. The Bureau has concluded that
since release of the Statement such circumstances have changed. Since
March 2020 and over the course of the pandemic, financial institutions,
including credit card issuers, have adjusted operations by, for
example, shifting to a remote mode of operation and enhancing remote
operational capabilities. As States and jurisdictions have rescinded
and modified stay-at-home orders over the course of the pandemic, the
Bureau has learned that many financial services entities have resumed
some level of in-person operations and, in many instances combined with
enhanced remote capabilities, have demonstrated improved business
continuity. Specifically, once States and jurisdictions rescinded and
modified stay-at-home orders, service representatives of credit card
issuers regained access to certain operational systems that could not
be accessed remotely and could resume responsiveness to consumer calls
about (1) opening a new credit card account for a consumer, (2)
providing certain temporary reductions in APRs or fees applicable to an
existing account, or (3) offering a low-rate balance transfer. Based on
the Bureau's market monitoring, the Bureau also notes that consumers
have accelerated their transition from traditional call communications
to digital means as the pandemic has progressed. Therefore, due to the
noted adjustments by credit card issuers and communication migration
from traditional calls to digital means by consumers, the temporary and
targeted flexibility provided by the Statement is no longer warranted.
Based on the Bureau's market monitoring, the Bureau believes that
credit card issuers have adapted and improved operations over the
course of the pandemic and are now able to respond to the credit needs
of consumers while still providing consumers with the full protections
afforded by TILA and Regulation Z without the flexibility afforded
under the Statement. The Bureau notes that many credit card issuers are
now choosing not to take advantage of the flexibility provided by the
Statement due to improved operational capabilities that enable the
provision of written disclosures. In addition, because the Statement
did not create binding legal obligations on the Bureau or create or
confer any substantive rights on external parties, it did not create
any reasonable reliance interests for industry participants. The Bureau
never intended the Statement to be permanent, and the Statement
expressly indicated that the relief was intended to be temporary and
targeted.
The Bureau continues to encourage institutions to meet the
financial services needs of their customers affected by the COVID-19
pandemic.
As the pandemic continues to unfold, consumers are struggling and
compliance with consumer law has never been more important. The
Bureau's statutory purposes include ``ensuring . . . that markets for
consumer financial products and services are fair, transparent, and
[[Page 17699]]
competitive.'' 12 U.S.C. 5511(a). Declining to cite conduct that is a
violation of TILA and Regulation Z based on the articulated principles
in the Statement may skew the consumer financial marketplace, to the
detriment of market participants who provide written disclosures in
accordance with TILA and Regulation Z while demonstrating an ability to
quickly assist consumers and respond to the credit needs of consumers
during the pandemic. To fulfill its statutory mandate, the Bureau has
made it a priority to direct its supervisory, enforcement, and other
tools to ensure that consumers are afforded full protection under the
law. It is therefore more important than ever that financial
institutions will adhere to the consumer protection requirements of
TILA and Regulation Z in their interactions with consumers and that the
Bureau use its supervisory and enforcement tools to the full extent and
with the full flexibility afforded by Congress.
The Bureau hereby rescinds, as of April 1, 2021, its Statement on
Supervisory and Enforcement Practices Regarding Electronic Credit Card
Disclosures in Light of the COVID-19 Pandemic and instructs all
financial institutions, including credit card issuers, to comply with
their obligations under TILA (15 U.S.C. 1601 et seq.) as implemented by
Regulation Z (12 CFR part 1026). Instead, in its discretion, the Bureau
intends to exercise its supervisory and enforcement authority
consistent with the Dodd-Frank Act and with the full authority afforded
by Congress consistent with the statutory purpose and objectives of the
Bureau. The Bureau does not intend to cite in an examination or
initiate an enforcement action against any entity that did not comply
with the TILA and Regulation Z written disclosure requirements as
described in the Statement between June 3, 2020, and April 30, 2021.
Regulatory Requirements
The Statement constituted a general statement of policy exempt from
the notice and comment rulemaking requirements of the Administrative
Procedure Act (APA). It was intended to provide information regarding
the Bureau's general plans to exercise its supervisory and enforcement
discretion and did not impose any legal requirements on external
parties, nor did it create or confer any substantive rights on external
parties that could be enforceable in any administrative or civil
proceeding. This rescission likewise is a general statement of policy
exempt from the notice and comment rulemaking requirements of the APA.
It is intended to provide information regarding the Bureau's general
plans to exercise its supervision and enforcement discretion and does
not impose any legal requirements on external parties or create or
confer any substantive rights on external parties that could be
enforceable in any administrative or civil proceedings. No notice of
proposed rulemaking was originally required in issuing the Statement,
and it is not required in issuing this rescission. The Regulatory
Flexibility Act also does not require an initial or final regulatory
flexibility analysis for this rescission. The Bureau has also
determined that the rescission of the Statement does not impose any new
or revise any existing recordkeeping, reporting, or disclosure
requirements on covered entities or members of the public that would be
collections of information requiring approval by the Office of
Management and Budget under the Paperwork Reduction Act.
Dated: March 29, 2021.
David Uejio,
Acting Director, Bureau of Consumer Financial Protection.
[FR Doc. 2021-06970 Filed 4-5-21; 8:45 am]
BILLING CODE 4810-AM-P