Uncertainty about how the Consumer Financial Protection Bureau (CFPB) will interact with other federal agencies, coupled with agitation on how the agency will conduct its enforcement procedures, was cited as a primary concern in a survey of 50 in-house lawyers polled by Chicago-headquartered law firm Mayer Brown.
‘Overall, while respondents are greatly concerned about the uncertainty surrounding the CFPB, they view the agency as an additional layer of regulation on top of existing regulatory overseers,’ says Mayer Brown in its new survey. ‘For example, the jurisdiction of the CFPB and the Federal Trade Commission overlap significantly, and the two agencies have said that they will engage in coordination. The extent and nature of the coordination remains to be seen, and if one of the respondents' key concerns is realized, it may be quite limited.
‘Another key wild card is the expected CFPB interaction with state attorneys general,’ Mayer Brown continues. ‘We see two potential challenges. First, because state attorney general positions are elected and often perceived as a springboard to higher office, there may be significant political pressure for attorneys general to use their new federal authority in high-profile state enforcement actions. Second, there is concern that information shared with attorneys general could find its way to plaintiffs' lawyers – which may fuel class-action civil litigation.’
Seventy-eight percent of the survey's respondents predict that their CFPB oversight will increase their companies' regulatory costs by at least 20%. Furthermore, 12% of the lawyers polled say their companies have been either subpoenaed or contacted in regard to a CFPB investigation. However, 76% of those polled say their companies have already established procedures to deal with CFPB inquests.