(Reuters) – The U.S. consumer financial watchdog on Monday announced the creation of a public database to identify nonbank financial companies that violate consumer laws, saying it would help expose and deter repeat offenders.
According to the bureau, the new regulations will require debt collection agencies, mortgage and payday loan providers, credit reporting agencies, and other non-bank financial services companies — many of which are not registered or licensed — to report actions taken against them at the federal, state, and local levels to the Consumer Financial Protection Bureau (CFPB).
“Too many American families and businesses are being harmed by repeated illegal conduct by bad actors who see fines and penalties as simply a cost of doing business,” CFPB Director Rohit Chopra told reporters.
“This registry will help the CFPB and other law enforcement agencies monitor and track repeat offenders and better hold them accountable when they break the law.”
CFPB officials said the new registry, first proposed for late 2022, would continue the agency's efforts to combat corporate recidivism, following the establishment that year of a repeat offender unit within the supervision program.
The database will be partially made publicly available online and will be available to state attorneys general and other regulators, as well as investors and creditors conducting due diligence, the agency said in a statement.
Officials said on Monday they had revised their original proposal in light of industry feedback, including allowing companies that already have enforcement actions recorded in the national licensing scheme for non-bank mortgage lenders to take advantage of a simplified application process.
But industry groups also objected to provisions that would remain in the new rules, such as requiring senior executives to provide written certification that companies are complying with existing court orders and enforcement actions.
The Electronic Trading Association, whose members include Amazon.com Inc., Apple Inc. and JPMorgan Chase & Co., asked the CFPB last year to allow challenges and delistings, but agency officials said Monday that they have no such procedure in place.
The first companies are expected to register in January 2025.
(Reporting by Douglas Gillison; Editing by Chris Reese and Bill Berkrott)
