On July 18, 2022, Venable attorney Jonathan Pompan was quoted in Inside Mortgage Finance on the Consumer Financial Protection Bureau (CFPB) considering a nonbank registration system. According to the article, CFPB Director Rohit Chopra outlined his plans for the bureau in a recent blog post and noted that he was looking at congressional authorities that had gone underused. While mentioned in just one sentence with little detail, one project he said the bureau is considering is a nonbank registration system that would “identify potential scammers and others that repeatedly violate the law.”
When asked about the prospect of a nonbank registration system, the CFPB pointed to a section of the Dodd-Frank Act (DFA) that it said “authorizes the bureau to impose registration requirements on any nondepository covered person, regardless of whether the covered person is subject to supervision.”
Pompan affirmed that the bureau has had the authority to create a nonbank registration system since the DFA became law. But he said it is unclear what registration connoted: Is it just providing a name, address, and contact information, or is more involved? And what implications would it hold for registered institutions?
Such a system, Pompan said, could “potentially serve as a gateway for further supervisory activity examinations of nonbanks that are presently not already under routine exam.” A maximalist approach, he said — noting that Chopra’s CFPB likes to think big — could make registration a prerequisite for providing consumer financial services and products. Pompan said that regardless of how the idea is implemented, a nonbank registry would be a “sea change.”