With the results of the presidential election now determined and the congressional races nearly complete, there is much at stake for both consumers and the financial services industry. In this webinar, members of the Venable team offered an in-depth analysis of a variety of issues with which the incoming administration will have to contend.
Among the key topics discussed were the probability of new protections and enforcement around consumer and prudential banking issues. With the change in administration, there may be an uptick in fair lending review and enforcement, with a renewed focus on disparate lending practices and payday loans. The Consumer Financial Protection Bureau (CFPB) is specifically addressed in the Biden administration’s transition plan, and the transition team is tapping individuals within the Bureau who have been key senior policymakers there since the CFPB’s inception in 2011. The new CFPB director is expected to ramp up enforcement actions and strengthen consumer protections in areas such as credit reporting, debt collection, fair lending requirements, interest rate caps, and others, while bringing a renewed focus on community investments as part of an effort to increase access to credit and capital for underserved communities and expand access to bank accounts.
Leadership in the areas of prudential banking may be slow to change, though the Biden administration will work to quickly reverse Trump administration deregulatory actions and address systemic issues and the industry’s COVID-19 response. The panel also discussed potential efforts to facilitate faster payments, ramping up the FedNow payment system to serve underbanked communities, and the Federal Trade Commission’s (FTC) likely agenda related to consumer protections and antitrust measures. FTC Commissioner Rohit Chopra has recently offered insight into areas of renewed agency focus, like merger enforcement, including pharmaceuticals and high-tech companies. From a consumer protection standpoint, several Supreme Court decisions may impact the focus and priorities of the FTC in coming years.
There has not been much coordination or collaboration between the CFPB and the FTC during the Trump presidency, and this may change under the Biden administration. Additionally, state attorneys general have played an increased role in the consumer protection space in the last few years, attempting to enforce consumer protection laws as a counterbalance to a shift in CFPB priorities.