Two protectors may be better than one, but not if they’re doing the same work.
After finally appointing Richard Cordray director for the Consumer Financial Protection Bureau (CFPB), the government is seeking to eliminate some unnecessary red tape to allow the consumer-oriented agency to do what it was supposed to do – actually help consumers.
The CFPB and the Federal Trade Commission (FTC) signed an agreement this week that says the agencies will work together to avoid regulatory redundancies when enforcing rules that impact lenders and other financial services firms.
The agencies will hold regular meetings where they will discuss how to coordinate enforcement efforts, rulemaking activities and other services. In what should be a case of the obvious, each agency agreed to inform the other before launching an investigation or enforcement action against a firm.
The contract also stipulates the agencies will meet routinely to discuss rulemaking and guidance initiatives, while also sharing all consumer complaints that reach their respective organizations.
The FTC’s enforcement actions often intersect with the mortgage finance space that is now mostly under the oversight of the CFPB.
While this probably won’t affect the way the consumer sees the enforcement, it’s important for agents to note the different regulatory bodies and how they will conduct investigations.