On October 29, the CFPB rescinded two related rulemakings that would have created public registries for nonbank financial companies. The Bureau withdrew both the Registry of Nonbank Covered Persons Subject to Certain Agency and Court Orders and the Registry of Supervised Nonbanks That Use Form Contracts To Waive or Limit Consumer Legal Protections rules, citing significant compliance costs, duplication with existing systems, and a lack of quantifiable consumer benefit.
Both rules were originally designed to expand the Bureau’s access to compliance and market-monitoring data from nonbank financial firms. The Nonbank Orders Rule required registration and executive attestations from entities subject to certain public orders, while the Form Contracts Rule would have required reporting of contract terms that restrict consumer rights. In each case, the Bureau determined that the associated costs, paperwork obligations, and operational burdens were not justified by measurable consumer benefits.
In the final notices, the Bureau detailed the following actions:
- Registry of Nonbank Covered Persons. The Bureau’s 2024 proposal required nonbank covered persons subject to certain public agency or court orders to report those orders to a CFPB registry and, for supervised entities, to provide annual executive attestations of compliance. The Bureau rescinded the rule after determining that its costs and paperwork burdens were not justified by the speculative and unquantified benefits described in the original rule. The Bureau also cited overlapping state and federal disclosure systems, such as the Nationwide Multistate Licensing System, and reduced agency resources as additional factors supporting rescission.
- Registry of Supervised Nonbanks Using Form Contracts. The Bureau also withdrew its 2023 proposal (previously discussed here) that would have required supervised nonbanks to register information about form contract terms such as arbitration clauses or liability limitations that seek to waive or limit consumer legal protections. The Bureau concluded that legislative rulemaking was not necessary or appropriate at this time, finding that the proposed registry would have imposed significant costs on supervised nonbanks and on the Bureau, while offering uncertain or speculative benefits.
Putting It Into Practice: The Bureau’s withdrawal of these registry initiatives confirms a shift away from broad public-registration requirements for nonbanks. These developments effectively end the Bureau’s attempt to build registries for enforcement orders and contract terms (previously discussed here and here). Nonbank entities are not required to take any new compliance actions, but should continue monitoring Bureau priorities as supervisory focus returns to targeted, risk-based examinations rather than public registries.
