There is much anticipation of what could be announced at the Consumer Financial Protection Bureau’s upcoming field hearing in Indianapolis tomorrow, and what it could mean for the auto finance industry.
“My expectation is that they will use that forum as an opportunity to announce the larger participants rule for the auto finance company,” Michael Thurman, a partner at Thurman legal, told Auto Finance News. “That rule will identify certain larger companies, not necessarily by name, but it will indicate what levels of revenue or what qualifies companies to be treated as larger participant by the CFPB. And those companies will then be subject to periodic, on site examinations by the CFPB.”
Nobody can say anything certain until the hearing is held tomorrow, Thurman said, but many industry watchers previously expected the CFPB to announce the larger participant rule in August.
“This announcements has been delayed from when it was expected, so that makes me wonder if the CFPB may not also announce that they have prepared an additional section of the CFPB supervision manual that will apply to auto finance,” Thurman said.”I imagine that will be something that companies will be looking for, to see if there’s specific guidance on what the examiners would look at with regard to larger participants in the industry, and what the exact nature of their examinations might be.”
Attorney David Anthony, a partner at Troutman Sanders, agreed that all we can do until tomorrow is read the tea leaves, but taking cues from the past, he speculates that any announcement made tomorrow will have a significant impact on the industry.
“As a general position, the field hearings have not been just ‘Hey, just wanted to see what everybody thinks,’” he said. “Typically, the CFPB has had an agenda, it has wanted to roll out a major announcements, it wanted to roll out an enforcement activity, it has wanted to roll out the rules, it has wanted to roll out a new emphasis, or something like that,” Anthony said. “So there have been a couple of — in most people’s view — pretty obvious cues as to some things that are likely on that plate.”
The CFPB field hearing begins tomorrow at 11 AM Eastern.