CFPB Finalizes Advisory Opinion Program: New Policy Allows Requestors to Seek Regulatory Clarity

4 January 2021
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Key takeaways:
  • The Consumer Financial Protection Bureau (the “CFPB”) recently finalized a policy describing its process for the issuance of advisory opinions. The new policy describes the process by which entities can request the CFPB to provide clarity regarding interpretive questions.
  • If accepted, requests will prompt the CFPB to provide an advisory opinion specifying the set of facts analyzed and the agency’s legal interpretation. The advisory opinions may provide a safe harbor or similar protection from CFPB enforcement actions for entities and individuals that have a reasonable basis for reliance on the opinion.
  • We believe the advisory opinion policy is a productive development; that firms should carefully monitor the issuance of advisory opinions, given that they may provide a safe harbor from enforcement (and, conversely, could lead to enforcement if a firm strays from an opinion’s interpretations); that firms should consider whether and under what circumstances to request an opinion; and that other federal financial regulators following the CFPB’s model should help increase meaningfully the clarity of regulatory requirements.