Last weekend created some excitement for those of us working in risk and compliance.
- On Friday, February 7, 2025, Russell Vought was appointed as the Interim Director of the Consumer Financial Protection Bureau (CFPB).
- On Saturday the 8th, Mr. Vought ordered employees to “cease supervision and examination activity”, before telling staff Monday to “stand down from performing any work task.”
- Then, the agency’s chief operating officer informed employees on Sunday that the CFPB’s headquarters would be closed for the week, and they were to work remotely, although they were told not “to perform any work tasks.” Additionally, they are to cease any pending investigations.
So, what does this mean for all of us? Some would argue not much.
We had laws and regulations before the CFPB. We will continue to have them going forward. Some of us can remember when the Federal Reserve Bank (FRB) had ownership of all the consumer protections regulations prior to the creation of the CFPB, with the passing of the Dodd Frank Act in 2010. Each new administration brings a change in direction for the CFPB and the power its has over rule making. Those of us focused on creating and executing risk based programs will keep doing it by implementing rules with in the framework of our financial institutions.
However, the recent surge of activity surrounding the CFPB has left both the agency and all of us in an uncertain position, particularly with the new administration and the Acting Director’s intentions for the Bureau still unclear and in flux. What we have observed so far could simply represent a pause—a re-evaluation of the Bureau’s actions, similar to the one that took place in 2017 when Mick Mulvaney was appointed Acting Director—or it might be the beginning of more substantial changes.
Some believe that the aggressive stance taken by former Director Chopra over the past three years, along with the flurry of rulemaking during the final 60 days of the previous administration, and the enforcement and supervisory actions in the last month of the Biden administration, likely contributed to the new administration’s decision to rein in the CFPB. This shift aims to bring more control and course-correct the Bureau’s trajectory.
All of us here at COMPLIANCE RESOURCE remain dedicated to helping you navigate compliance regulation, and are here to help if you have any questions. We will continue to monitor developments and interpret what they mean for all of your risk and compliance programs.