Saturday, July 13, 2024

OBA, other state bankers associations urge delay of Section 1071 implementation

The Consumer Financial Protection Bureau should extend a court-ordered stay of its Section 1071 final rule to cover all FDIC-insured banks while the U.S. Supreme Court considers a separate legal challenge concerning the bureau, the OBA and 49 other state bankers associations said last week in a letter to CFPB Director Rohit Chopra.

A federal judge in Texas last week issued a preliminary injunction of the rule until the Supreme Court decides on a case involving the constitutionality of the bureau’s funding structure in CFPB v. Community Financial Services Association of America. The 1071 case was brought by the Texas Bankers Association, Rio Bank and the American Bankers Association, which asked for a national injunction covering all lenders. However, the judge sided with the CFPB’s request to have the order apply only to those associations’ members.

ABA and TBA have since asked Chopra to delay 1071 compliance for all banks, and in their letter, the state associations repeated that request