News Release: CFPB Database Expected to Help Curb Repeat Consumer Law Violations


June 4, 2024

Carter Dougherty

CFPB Database Expected to Help Curb Repeat Consumer Law Violations

A new centralized public database that catalogs violations of consumer protection laws by nonbank financial companies like payday lenders and debt collectors will aid state and federal enforcement efforts that often operate under the radar and are hard to track.

“Nonbank financial companies that repeatedly violate consumer protection laws will no longer get to hide behind fragmented reporting systems and misconduct will be easily searchable in one central location for consumers, investors, and regulators at every level of government,” said Christine Zinner, senior policy counsel with Americans for Financial Reform. “This database is bad news for repeat offenders, but good news for the rest of us.”

Orders stemming from enforcement actions may be issued by government agencies and courts. While these orders are publicly available, repeat wrongdoing may be missed if the resulting orders are scattered across various local, state, and federal databases, if they are documented at all. Complicating matters further, nonbank financial companies are also inconsistently regulated across states, making it harder to catch repeat offenders that restart fraudulent and illegal activities in different places.

The repeat misconduct registry will help remedy these regulatory blind spots and make it easier for regulatory agencies across the local, state, and federal levels to more easily spot bad actors. Members of the public, investors, creditors, business partners, and consumer advocacy organizations will also be able to more easily track financial firms subject to law enforcement orders due to repeat consumer violations.

Notably, this is the first time the CFPB has used its statutory authority to register nonbanks, an important step that will also help regulators across government track financial companies which are not otherwise registered or licensed.