BPI and CBA Respond to CFPB’s Proposed Amendments to Regulation V

Ladies and Gentlemen:

The Bank Policy Institute^[1] and the Consumer Bankers Association (CBA)^[2] are writing in response to the Consumer Financial Protection Bureau's proposed rule entitled "Protecting Americans From Harmful Data Broker Practices (Regulation V)."^[3] As an initial matter, we note that this proposal was issued and published in the Federal Register for comment under the Bureau's prior leadership during the period between the election on November 5, 2024, and Inauguration Day on January 20, 2025.

We understand that the Acting Director of the CFPB, Russell Vought, issued a directive to CFPB staff shortly after his appointment, to, among other things, not "approve or issue any proposed or final rules or formal or informal guidance."^[4] We appreciate this directive, as we believe it is critically important that incoming leadership and staff at the CFPB have the time and opportunity to review the past and ongoing work of the Bureau to determine the Bureau's posture and potential next steps regarding that work. We appreciate that new CFPB leadership provided additional time for the public to respond to this proposal.^[5] However, as this proposal and other outstanding requests for comment issued under the previous Director's leadership necessarily reflect the prior Administration's policy priorities, and for reasons we previously cited in our response to the prior Administration's notice of proposals under the SBREFA process that are not reflected in the proposal, we respectfully request that this proposal be rescinded.^[6] The current proposal, if finalized, would create significant risk and uncertainty in the ecosystem. It is important that new CFPB leadership review and determine whether these proposals and requests for information are consistent with the legal and policy positions of the new leadership before industry and Bureau staff expend time and resources responding to, and reviewing responses to, proposals that do not reflect the positions or priorities of the new Administration.

The new CFPB leadership should take further action to address the concerns cited by the Bureau in the proposal only after considering those questions and engaging in a thorough review of the concerns identified as motivating the proposal and the public record of the CFPB's actions to date on this rulemaking, including the comments received in response to the proposal. To ensure that our comments are included in the official record of the proposal's comment file and considered in connection with the CFPB's evaluation of any next steps on this proposal, we are providing the comments contained herein.

The proposal cites several reasons the CFPB is engaging in this rulemaking, including concerns about consumer privacy in the "collection, assembly, evaluation, dissemination, and use of vast quantities of often highly sensitive personal and financial data."^[7] We share the CFPB's goal of protecting consumer privacy, and we understand the CFPB is concerned about the ways in which consumers' data is used outside of the banking context. However, as we noted in our response to the CFPB's SBREFA outline issued in connection with this proposed rulemaking, several parts of the proposal may have unintended consequences, particularly for banks and their customers.

To read the full comment letter, please click here, or click on the download button below.

[1] The Bank Policy Institute is a nonpartisan public policy, research and advocacy group that represents universal banks, regional banks, and the major foreign banks doing business in the United States. The Institute produces academic research and analysis on regulatory and monetary policy topics, analyzes and comments on proposed regulations, and represents the financial services industry with respect to cybersecurity, fraud, and other information security issues.

[2] CBA is the only national trade association focused exclusively on retail banking. Established in 1919, the association is a leading voice in the banking industry and Washington, representing members who employ nearly two million Americans, extend roughly $3 trillion in consumer loans, and provide $270 billion in small business loans.

[3] 89 Fed. Reg. 101402 (Dec. 13, 2024).

[4] The previous Acting Director, Secretary of the Treasury Scott Bessent, issued a similar directive on his appointment as Acting Director, which was superseded by the Appointment of Acting Director Vought.

[5] 90 Fed. Reg. 11236 (March 5, 2025).

[6] See BPI, CBA, and TCH letter to CFPB re: Comments on the Small Business Advisory Review Panel for Consumer Reporting Rulemaking Outline of Proposals and Alternatives Under Consideration (Nov. 6, 2023). In addition to the proposal, on December 9, 2024, the CFPB issued an Advance Notice of Proposed Rulemaking on "Fair Credit Reporting Act (Regulation V); Identity Theft and Coerced Debt," with a comment deadline of March 7, 2025; On January 10, 2025, the CFPB issued a proposed interpretive rule on "Electronic Fund Transfers Through Accounts Established Primarily for Personal, Family, or Household Purposes Using Emerging Payment Mechanisms," with a comment deadline of March 31, 2025; On January 10, 2025, the CFPB issued a Request for Information "Regarding the Collection, Use, and Monetization of Consumer Payment and Other Personal Financial Data," with a comment deadline of April 11, 2025; and On January 13, 2025, the CFPB issued a proposed rule on "Prohibited Terms and Conditions in Agreements for Consumer Financial Products or Services (Regulation AA)," with a comment deadline of April 1, 2025. Each of these proposals should be paused, at a minimum, if not rescinded as soon as possible.

[7] Id.