CFPB Solicits Comments on CID Process

CFPB  •  Enforcement

The Consumer Financial Protection Bureau (CFPB) has solicited comments to assist it to revise its current Civil Investigative Demand (CID) process.  The “Request for Information Regarding Bureau Civil Investigative Demands and Associated Processes” was published in the Federal Register on January 26, 2018.

The CFPB’s power to issue CIDs is derived from 12 U.S.C. § 5562 and 12 C.F.R. § 1080.6, which authorizes issuance “[w]henever the Bureau has reason to believe that any person may be in possession, custody or control of any documentary material or tangible things, or may have information[] relevant to a violation.”  12 U.S.C. § 5562(c)(1).  In issuing its request for comment, the Bureau stated that it “understands … that responding to a CID can impose burdens on the recipients.”  The Bureau clarified that it “is especially interested in better understanding how its processes … may be updated, streamlined, or revised to better achieve the Bureau’s statutory and regulatory objectives, while minimizing burdens … and how to align the Bureau’s CID processes with those of other agencies with similar authorities.  Interested parties may also be well-positioned to identify those parts of the Bureau’s processes related to CIDs that are most in need of improvement, and, thus, assist the Bureau in prioritizing and properly tailoring its review process.”

The following areas of potential feedback are of particular interest to the CFPB:

  1. The process for initiating investigations;
  2. The process for issuing CIDs;
  3. Steps the CFPB could take to ensure recipients of CIDs understand investigations;
  4. Whether the “nature and scope” of CID requests and the meet and confer process “effectively achieve the Bureau’s statutory and regulatory objectives, while minimizing burdens, consistent with applicable law;”
  5. Current time-frames for complying with each portion of the CID process;
  6. The taking of oral testimony from an entity;
  7. Unintentional production of privileged documents and information;
  8. Witnesses’ rights;
  9. Meet and confer requirements;
  10. Requirements for responses to CIDs; and
  11. Petitioning to modify or set aside CIDs.

Comments are due by March 27, 2018.  Formal comments can be submitted through several means identified on federalregister.gov, and public comments are made available here.

This request for comment may be indicative of a CFPB more attune to industry concerns than in years past, and signals that the CFPB may implement certain reasonable requested changes to its CID process.

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