on Legal & RegulatoryThought Leadership

Life, Lady Liberty and the Pursuit of Happy Consumers; Hello NYDFS

The New York Department of Financial Services is ready to step in if the CFPB loosens the reins.

Since 2011, the Consumer Financial Protection Bureau (CFPB) has been working to provide guidance to businesses to help reduce UDAAPs (unfair, deceptive, or abusive acts and practices) that can cause financial injury to consumers, erode consumer confidence and undermine the financial marketplace. In fact, the CFPB has garnered more than $11.9 billion in relief, for over 29 million consumers in the past 6 years.

Recently named acting CFPB Director, Mick Mulvaney, is looking at how government resources are utilized and plans to enforce regulation when “all other attempts at resolution fail.” Mulvaney's looking to take a diplomatic approach in evaluating enforcement actions, a shift in focus compared to former CFPB Director Richard Cordray’s technique. Mulvaney plans to reconsider a regulation that would mandate payday lenders to determine if a borrower can pay back their loans or not. If the rule gets tossed, it will certainly be an adjustment to the regulations lenders once faced.

Another potential change would be to the CFPB itself as recently proposed in 2019 budget revisions. Under the proposal, the CFPB would be backed by Congress as opposed to the Federal Reserve, and would be capped at $485 million in operating spend. This is a big dip from 2018’s projected $630 million operating spend, which could put limits on the agency’s enforcement authority.

In light of these new developments, Maria Vullo, Superintendent of the NYDFS (New York Department of Financial Services) says that her office is ready to address the lack of  CFPB enforcement power if these changes go through. Vullo vows the NYDFS will act as a layer of support to the protection the CFPB provides, regardless of personnel and potential policy changes there.


"Since its founding, the CFPB has been a strong and vital partner with the New York State Department of Financial Services and state regulators nationwide on many important consumer protection issues. [...] DFS remains committed to its mission to safeguard the financial services industry and protect New York consumers.”  
- Maria Vullo, NYDFS


So what’s the bottom line?

Consumer protection is here to stay at the state and federal level. Using compliance as a competitive advantage will continue to strengthen company brands. If you'd like to learn more about regulatory compliance for your brand, contact me here or join us at COMPLY2018, the RegTech and Compliance Conference.

Dates Announced for COMPLY2019


Paul Monticello

Paul has 11 years of experience from ADP, and will leverage that experience at PerformLine to foster partnerships with organizations looking to protect their brand and consumers alike. Paul is a Yankees fan and enjoys exercising daily and snowboarding in the winter.

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