Within hours of President Obama's recess appointment of Richard Cordray as the first director of the Consumer Financial Protection Bureau, the directors of the agency’s banking and nonbanking supervisory divisions announced the activation of the nonbank supervision program. Although the CFPB previously had assumed responsibility for supervising large banks with assets in excess of $10 billion from other banking regulators last July, this marks the first real change to the consumer financial landscape for nonbanking companies.
In a statement on the agency website, Nonbanking Supervision Unit director Peggy Twohig and Depository Supervision Unit head Steve Antonakes announced that the new program will begin immediately overseeing mortgage companies (including originators, brokers and servicers), loan modification and foreclosure relief services, payday lenders and private education lenders.
The agency will also soon enact rules specifying the definition of “larger participants” for all other consumer financial markets, including debt collection, consumer reporting, auto financing and money services businesses. Those companies that are designated as “larger participants” also will be subject to the CFPB’s supervisory jurisdiction.
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