WASHINGTON, D.C. — The ombudsman of the Consumer Financial Protection Bureau — who is ordered to be an independent, impartial, and confidential resource to help both finance companies and consumers resolve issues arising from agency activities — released its report for the 2013 fiscal year.
Among the highlights of the document, CFPB ombudsman Wendy Kamenshine covered a wide array of issues, including how the agency shares information and how regulators conduct the examination process.
“The ombudsman heard feedback from consumer and trade groups, as well as financial entities, regarding how the CFPB shares information about its activities, events and services,” Kamenshine said.
“Stakeholders overall highlighted that the CFPB was accessible for meetings and to answer questions. At the same time, they indicated that standardizing certain processes regarding how the CFPB shares this information would be helpful,” she continued.
According to the report, consumer and trade groups told the ombudsman that it is challenging to keep up-to-date with CFPB activity across its website at consumerfinance.gov
“The CFPB includes ‘sign-up’ features on consumerfinance.gov where anyone can request to receive email updates on the content found on certain webpages, for example, on additions to the Regulations webpage,” Kamenshine said.
“This year, the CFPB also re-launched the regulations webpage to provide more accessible information to financial entities and their trade groups, and now is conducting a review of consumerfinance.gov,” she continued.
To further address the availability of information, Kamenshine recommended several options, including
- The addition of a digest to all updates to consumerfinance.gov
- A checklist opportunity for users to subscribe to each available CFPB “sign-up” rather than searching for “sign-ups” on each consumerfinance.gov webpage
- An option for stakeholders to “sign-up” to receive the Division of External Affairs’ newsletter.
Review of the Examination Process
This fiscal year, Kamenshine indicated that she heard concerns from financial entities and their trade groups regarding CFPB’s supervisory examinations. Those questions revolved around how a finance company may elevate concerns about the examination and what may be expected during the examination lifecycle.
Kamenshine explained that she reviewed the CFPB’s examination processes, the examination manual as well as templates used for correspondence with financial entities. She pointed out that she considered various perspectives by meeting with CFPB leaders, financial entities, outside attorneys, and trade groups, and shared possible recommendations to the CFPB to obtain feedback on them.
As a result, Kamenshine highlighted that last December, the CFPB Division of Supervision, Enforcement, Fair Lending and Equal Opportunity (SEFL) undertook a reorganization of supervision to provide programmatic efficiencies in policy setting and examination processes.
“The ombudsman understands that the SEFL reorganization will address some of the examination process issues highlighted to the ombudsman. Further, the ombudsman understands that SEFL continues to refine its processes and incorporate best practices for examinations,” Kamenshine said.
To build on the process changes in connection with SEFL’s reorganization, Kamenshine provided recommendations to further standardize and clarify what a finance company may expect in an examination. Those recommendations included:
- The CFPB sharing how a financial entity may elevate concerns about the examination process by providing specific information on who composes the examination team through the regional director
- Supplementing the Information Request template (which provides the Examiner-In-Charge (EIC) point of contact for the Information Request and sharing about interagency coordination) to mention the EIC as the point-of-contact to address any concern during the examination lifecycle such as data format, data scope, and follow-up information requests.
In addition, Kamenshine recommended that the CFPB clarify what may be expected during the examination lifecycle. She mentioned several elements, including
- Citations to the examination manual in written communications to a finance company, where relevant;
- Describing in the opening letter the document an entity may expect at the end of the examination process
- Reaching back to inform the entity of the examination status at regular intervals after the conclusion of the onsite portion of the examination
- Co-locating the appeals bulletin with the examination manual on consumerfinance.gov
Future Plan of Action
Kamenshine wrapped up her report by sharing how she plans to further focus efforts going forward, including an 18 to 24 month strategic plan that incorporated the following strategic goals:
- Develop and implement an effective outreach strategy to engage internal and external stakeholders
- Provide deliverables to inform stakeholders of the work of the ombudsman
- Develop ombudsman resources to offer options to address common inquirer concerns
- Streamline internal workflow processes to maximize ombudsman efficiency and effectiveness.
“The ombudsman also looks forward to additional opportunities, such as this year’s visit to a financial entity’s operations and shadowing a CFPB examination, to build on our ability to assist consumers and financial entities that contact the ombudsman in the coming year,” Kamenshine said.
The complete ombudsman report can be downloaded here.
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