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CFPB Report: 2014-SR-C-013 September 29, 2014

The CFPB Complies With Section 1100G of the Dodd-Frank Act, but Opportunities Exist for the CFPB to Enhance Its Process

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Commendable Action: RMR Has Taken Actions to Comply With Section 1100G of the Dodd-Frank Act

Our evaluation found that the CFPB complied with section 1100G provisions related to the cost-of-credit analysis for small entities and small business review panels as well as the agency's interim internal policies and procedures. For all rules that required a cost-of-credit consideration analysis, we found that RMR collected advice and recommendations regarding the potential increase in the cost of credit for small entities and considered the impact that the rule may have on end-user consumers by conducting independent analysis. In addition, we found that RMR considered alternatives to the proposed rule that would minimize any increase in the cost of credit for small entities. We sampled six proposed and final rules that were published in the Federal Register during the July 21, 2010, to April 18, 2013, time period, which are detailed in appendix B. The sample included four rules with a cost-of-credit component. These four rules constitute all of the proposed or final rules that included a cost-of-credit analysis during our scope period.

We reviewed RMR's interim guidance and concluded that it is consistent with the provisions of section 1100G of the Dodd-Frank Act and the RFA. In reviewing the internal guidance, we noted that it emphasized a rigorous and multidisciplinary approach to rulemaking using evidence that the CFPB can reasonably obtain. Analysis is expected early in the rulemaking process to determine whether a proposed rule will be subject to the RFA. The guidance documents provide the rulemaking framework for RMR to assess whether a proposed or final rule would have a SISNOSE. When small business review panels are warranted, the guidance outlines the key activities, the purpose of interaction with other agencies, and the anticipated timing of such actions.