Small business owners often have the same mentality; “My business is so small that the Consumer Financial Protection Bureau (CFPB) will not care what I do.” Unfortunately, this type of thinking can put your business at risk.
In early May, the CFPB announced it had fined a small Texas builder over $100,000 for what were deemed illegal kickbacks under RESPA Section 8.
The CFPB recently released its State Coordinated Coordination Framework, which outlines how the Bureau will extend its regulatory reach throughout each state. This is being done in an effort to share audit findings, coordinate examination schedules and coordinate and consult on the identification and supervision of financial institutions, including non-depositories.
In other words, financial institutions of all sizes, both large and small, will be targeted. Under the new framework, state agencies will focus their efforts on single state, non-depository institutions – those businesses that had previously fallen below the CFPB’s radar – while the Bureau focusses on multi-state lenders. To help expedite this process, the CFPB and state regulators will develop standards for “uniformity, standardization, consistency, and effectiveness.”
State agencies will coordinate with the CFPB prior to taking any corrective actions.
Is your small business CFPB compliant?
If you have questions about our blog, “Your Small Business is Not Too Small to Matter to the CFPB,” or your institution’s current compliance management system, please contact Offit Kurman labor and employment attorney Ari Karen at firstname.lastname@example.org. Mr. Karen is an experienced litigator and speaker who has focused his practice in representing financial institutions in both government investigations and litigation before state and federal trial and appellate courts nationwide.
Offit Kurman Attorneys at Law: Financial Institutions Compliance Practice Group
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The CFPB Will Not Think You Are Too Small to Matter National Mortgage News