Bradley attorney Mike Gordon was quoted in American Banker on what Rohit Chopra might do with the $570 million consumer aid fund if he is confirmed as CFPB director. The civil penalty fund is made up of fines and penalties paid by wrongdoers for violations of consumer financial laws and can only be used to compensate consumers who have been harmed or for consumer education and financial literacy programs. However, many expect Chopra to take an aggressive approach and revive the enforcement activities practiced under Rochard Cordray, Obama's appointee.
“From the first days of the bureau, Republicans in Congress have expressed concerns about potential uses of the civil money penalty fund,” said Mike Gordon, a partner at the law firm Bradley and a former senior official at the CFPB.
“Under a Director Chopra, I would expect the CFPB to take a more aggressive enforcement posture, and that includes seeking stiffer civil money penalties where appropriate,” said Gordon.
“Dodd-Frank gave the CFPB broad discretion in setting civil money penalty amounts, and we’ve seen wide variation in the amounts levied,” said Gordon. “As with any regulatory activity, industry prefers certainty and predictability. Other federal bank regulators use a matrix to promote a more consistent approach of setting penalty amounts, but the CFPB has never adopted that approach.”
The original article, "What Will Incoming CFPB Chief Do With $570 Million Consumer Aid Fund?" appeared in American Banker on January 25, 2021.