1071 Small Business Data Collection and Submission: Where Are We Now?
The CFPB (finally) issued its long-awaited Final Rule on Small Business Lending Data Collection, which will require lenders to collect and submit to the CFPB data around small business loan applications by June 1 of each year. But wait a minute, didn’t a federal judge halt its implementation? Not so fast — the whole issue is up in the air a bit, but lenders should not take this as a sign that the rule is going away. Far from it — the extra time should be used to make sure things are right.
However this turns out, there is a transitioned implementation period, and when lenders must comply is based on how many small business loans they originate. This rule will have a dramatic impact on small business lenders’ operations, and not just from an operational, and perhaps more importantly, a cultural, standpoint. There are significant cultural issues to address as well, as this will change, in significant ways, how small business applications are collected and processed.
In this webinar, we’ll do a deep dive into the rule, including when, and whether, the institution must begin to collect and submit data. But our focus will not be a simple recitation of the rule, but how to effectively develop your implementation plan. We’ll review the many issues so you can methodically ensure your program is on track.
One of the many keys to determining the requirements is to understand the definitions involved, from “covered financial institution,” “covered origination,” and “covered credit transaction,” among others. We’ll discuss precisely what a small business is, so you can zero in on which areas of the institution are affected by the requirements. We’ll also examine the many data requirements — what they mean, how they’re defined, how to collect them, and ultimately submit them. This rule will have exact a heavy load on the technology and automation functions of the institution, and we’ll discuss some best practices in this area.
We’ll also talk about what this data means from a fair lending standpoint, including the public nature of the information and some suggestions for fair lending analytics, as well as policy and procedure impacts. Join us for this in-depth discussion of the rule so you can best prepare for implementation, both operationally and technologically, and also culturally.
What You’ll Learn
- Current status of the legal fight for implementation of the rule: who is affected and what can we look forward to?
- The Final Rule itself: where to find many helpful resources for compliance
- Differences between the proposal and Final Rule
- Who is covered? Examining the coverage thresholds and timing requirements, including the “transitional provision”
- Interplay between this rule, HMDA, and CRA reporting requirements
- Who is a “covered financial institution”?
- Determining what to report: covered credit transactions and covered originations
- What types of applications are reported? How is an application-defined for this purpose?
- Deep dive into the data points: both those generated by the lender as well as those provided by the applicant
- Collecting demographic information: forms, verifications, policies, procedures, and (fortunately) no responsibility to guess
- Submission requirements: technology implications
- The “firewall” requirement: ensuring lenders to not have improper access to the data
- Safe harbor and “bona fide errors” provisions
- The CFPB’s Policy Guidance on supervisory and enforcement activities
1071 Small Business Data Collection and Submission: Where Are We Now? has been approved for 2.5 CRCM credits.
Who Should Attend?
Anyone in the institution who is involved in small business lending, particularly the application part of the process needs this course. This could include commercial lenders, processors, front-line staff, commercial lending support staff, and related employees, as well as compliance professionals, auditors, risk managers and officers, and line of business managers. Also, executive management and even Directors would benefit from understanding the requirements of this extensive new rule.
Carl Pry is a Certified Regulatory Compliance Manager (CRCM) and Certified Risk Professional (CRP) who is a Managing Director for Treliant Risk Advisors in Washington, D.C. Through his working career, as well as through his experience as a banking attorney and officer, he has provided a variety of regulatory compliance and financial performance services to financial institutions and other clients throughout the country. He has written extensively regarding consumer and commercial compliance, tax, audit, and financial institution legal issues, and is a frequent contributor to and currently serves on the Editorial Advisory Board for the ABA Bank Compliance magazine. He has spoken at scores of banking, compliance, and state bar associations, and has conducted training sessions for financial institutions across the country.
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