House appropriations bill amendment would delay enforcement of CFPB payday loan rule

According to a Politico report, the House Appropriations Committee has advanced a bipartisan amendment to the FY17 Financial Services and General Government Appropriations bill that would block the CFPB from enforcing a rule regulating payday and vehicle title loans until the CFPB submits a detailed report on the consumer impact to Congress.  The amendment, which was sponsored by Republican Congressman Steven Palazzo and Democratic Congressman Henry Cuellar, was adopted by the committee in a 30-18 vote.

On June 2, 2016, the CFPB issued a proposed rule covering payday and auto title loans, deposit advance products, and certain high-rate installment and open-end loans.  On June 15, 2016, from 12 p.m. to 1 p.m. ET, we will hold a webinar on the proposal: The CFPB’s Proposed Payday/Auto Title/High-Rate Installment Loan Rule: Can Industry Adapt to the New World Order?  Information about the webinar and a link to register are available here.

The FY 2017 appropriations bill already included several provisions intended to curb the CFPB’s authority, including a provision that would block the CFPB from enforcing a rule regulating pre-dispute arbitration agreements until it has submitted to Congress a study that meets criteria specified in the bill.  On May 5, 2016, the CFPB issued a proposed rule that would prohibit covered providers of certain consumer financial products and services from using an agreement with a consumer that provides for arbitration of any future dispute between the parties to bar the consumer from filing or participating in a class action with respect to the covered consumer financial product or service.  The proposed rule would also require a covered provider that is involved in an individual arbitration pursuant to a pre-dispute arbitration agreement to submit specified arbitral records to the CFPB.

http://www.jdsupra.com/legalnews/house-appropriations-bill-amendment-52710/