Annual Report 2012 - ffiec

24
Consumer Financial
Protection Bureau
The Consumer Financial Protection
Bureau (CFPB) was created in
2010 by the Dodd-Frank Act and
assumed transferred authorities
from other federal agencies, and
other new authorities, on July 21,
2011. The CFPB is an independent
agency and is funded principally
by transfers from the FRB up to a
limit set forth in the statute. The
CFPB requests transfers from the
Board in amounts that are reasonably
necessary to carry out its mission.
Funding is capped at a preset
percentage of the total 2009
operating expenses of the Federal
Reserve System, subject to an
annual adjustment. The Director
of the CFPB serves on the FDIC
Board of Directors and the Financial
Stability Oversight Council.
The CFPB seeks to foster a consumer
financial marketplace
where customers can clearly see
prices and risks up front and can
easily make product comparisons;
in which no one can build a business
model around unfair, deceptive,
or abusive practices; and that
works for American consumers,
responsible providers, and the
economy as a whole. To accomplish
this, the CFPB works to help
consumer financial markets operate
by making rules more effective,
by consistently and fairly
enforcing those rules, and by
empowering consumers to take
more control over their economic
lives.
The Dodd-Frank Act sets forth the
following functions for the CFPB:
• conducting financial education
programs;
• collecting, investigating, and
responding to consumer
complaints;
• collecting, researching, monitoring,
and publishing informa-
tion relevant to the identification
of risks to consumers and
the proper functioning of financial
markets;
• issuing rules, orders, and guidance
implementing federal consumer
financial laws;
• taking appropriate enforcement
action to address violations
of federal consumer financial
laws; and
• supervising covered entities
to assess compliance with federal
consumer financial laws
and detect financial risks to
consumers.
The CFPB has statutory authority
to conduct examinations to
ensure that consumer financial
products and services conform to
certain federal consumer financial
laws, and for related purposes.
The CFPB’s supervision program
oversees:
• Insured depository entities with
total assets over $10 billion and
their affiliates. These institutions
collectively hold more
than 80 percent of the banking
industry’s assets.
• Certain nondepository entities
regardless of size—mortgage
companies (originators,
brokers, and servicers, as well
as related loan modification
or foreclosure relief services
firms), payday lenders, and
private education lenders. The
CFPB can also supervise the
larger players, or “larger participants,”
as defined by rule,
in consumer financial markets,
and certain nondepository entities
that it determines are posing
a risk to consumers in connection
with the offering or
provision of consumer financial
products or services. In 2012,
the CFPB began identifying
other markets in which it will
supervise the larger partici-