Here. A CFPB Monitor reader provided the account of CFPB Director Richard Cordray's meeting with South Dakota community banks and credit unions. Among other things, the industry folks expressed concerns about the cost of complying with regulations and the proliferation of disclosure rules. A couple of excerpts:
The CEO of one bank talked first. He held up a copy of a mortgage that it was using back in 1979. The document was 2 pages long and contained 8 signatures. He then held up an example of the mortgage disclosures they are providing today. They are about an inch thick and he stopped counting at 92 signatures. He said he was dismayed to read that the CFPB has introduced yet another set of new disclosures for mortgage servicers. He believes consumers have become numb to all the disclosures and the CFPB needs to take a fresh look at all of the requirements and simplify the process for consumers and banks alike.
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Another member of the audience asked Director Cordray how he thought the pricing of products factored into the “abusive” standard, if at all. He acknowledged the CFPB has no authority to regulate interest rates or fees or otherwise engage in price fixing. He said where he sees the abusive standard intersecting with pricing is the manner in which the pricing is disclosed. He said pricing disclosures should be clear, there shouldn’t be any backend pricing and consumers should be allowed to make informed decisions. He said he understands that consumers are willing to pay a higher price for certain products because they like how the product works or the convenience of a product. However, the concern with the CFPB would be when a consumer gets a product thinking it costs less than it does because the pricing isn’t properly disclosed.
Thanks for such a great post and the review, I am totally impressed! Keep stuff like this coming.
Posted by: travel gadling | Tuesday, July 03, 2012 at 03:03 AM