The CFPB Can Enhance Its Process for Notifying Prudential Regulators of Potential Material Violations

Recently, the Offices of Inspector General (OIGs) for the prudential regulators¹ conducted a joint review of the coordination between the Consumer Financial Protection Bureau (CFPB) and the prudential regulators with respect to performing supervisory activities and avoiding duplication of regulatory oversight responsibilities on matters related to federal consumer financial laws and regulations.² The OIGs concluded that the CFPB and the prudential regulators were generally coordinating their regulatory oversight activities for federal consumer financial laws in a manner consistent with the provisions of a memorandum of understanding governing coordination activities and with the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).³ Nonetheless, the OIGs identified opportunities for enhanced coordination, including an opportunity for the CFPB to develop a standard process for notifying the prudential regulators of federal consumer financial law violations by institutions with $10 billion or less in total assets.

• 1. The prudential regulators are the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the National Credit Union Administration. Return to text
• 2. Offices of Inspector General for the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the National Credit Union Administration, Coordination of Responsibilities Among the Consumer Financial Protection Bureau and the Prudential Regulators—Limited Scope Review, Board-CFPB OIG Report No. 2015-SR-X-009, June 1, 2015. Return to text
• 3. The OIGs agreed that the objective of this review could be addressed with a limited-scope review rather than an audit or evaluation. As a result, the review was not conducted under government audit or evaluation standards. Return to text