Consumer bureau to revise mortgage, prepaid card rules from Cordray era

The Consumer Financial Protection Bureau (CFPB) said Thursday the agency will review and reconsider aspects of two rules issued by its former directer, Richard Cordray.

Under acting Director Mick Mulvaney, the CFPB announced plans to revise rules issued by Cordray regarding mortgage data collection and prepaid credit cards.

One of the revisions: The bureau will no longer assess penalties against mortgage lenders and banks for errors collected in data next year that is subject to the Home Mortgage Disclosure Act (HMDA). The bureau also won’t ask for lenders to resubmit such data if errors aren’t “material” to the information provided.

The CFPB also said it would begin the process of making a rule to revise parts of the CFPB’s 2015 rule regarding the HMDA.

The bureau singled out institutional and transactional coverage tests, discretionary data points and lending-activity criteria that determine whether institutions are required to report mortgage data.

“The rulemaking may also look at adjusting the new requirements to report certain types of transactions,” the CFPB statement said. “Finally, the rulemaking may re-assess the additional information that the rule requires beyond the new data points specified under the Dodd-Frank Act.”

The bureau also announced it would soon issue a rule to amend a 2016 regulation on prepaid cards and debit accounts.

“As part of that process, the Bureau expects, based on its review of the comments received, to further extend the effective date of the 2016 rule to allow additional time for implementation of the final rule,” the CFPB announced.

“The Bureau proposed making changes to the prepaid rule in June; the comment period on the proposal ended in August, and the record is now closed for public input,” it said.

The announcement signaled the first formal moves by Mulvaney, the White House budget director appointed by Trump as acting director, to undo Cordray’s regulatory legacy. A staunch conservative who once sought to eliminate the bureau, Mulvaney has promised to end and reverse the CFPB’s extensive regulations and crackdowns on the financial sector.