Payday Lending and Regulation OO 2022 Update
On October 5, 2017 the Consumer Financial Protection Bureau’s (CFPB) published Regulation OO to implement the Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule (Payday Loan Rule). The final rule was effective on October 20, 2020; however, the Payment Provisions were stayed by a court order. On August 31, 2021, the U.S. District Court for the Western District of Texas, granted the Consumer Financial Protections Bureau’s (CFPB) motion for summary judgment in Community Financial Services Association of America, Ltd., Consumer Service Alliance of Texas v. Consumer Financial Protection Bureau [and its Director], and ordered that the compliance date of the “Payday, Vehicle Title, and Certain High-Cost Installment Loans” Rule (12 CFR Part 1041) be stayed until 286 days after the date of the court’s order, June 13, 2022. Subsequently the plaintiffs appealed the ruling. During October 2021 the court extended the effective date until 286 days after the appeal is settled.
Most depository institutions do not originate large volumes of “covered loans”. For those with limited covered loans, it is reasonable to tweak the product line-up to avoid the massive new rules. How do you evade the requirements of a regulation that contains two separate requirements (Sections 1041.5(e) and .13) that prohibit evasion? That is one of the many questions answered in this program.
- Which financial institutions are covered by Regulation OO;
- What loans are covered by Regulation OO, what loans are exempt, and options for managing loan products to avoid coverage;
- The basic requirements of the Payday Rule including:
- Key definitions from subpart A;
- The elimination of the underwriting provisions from subpart B;
- The payments provisions, including the unfair and abusive practices, prohibited payment transfer attempts rules and the disclosure requirements for attempted payments, from subpart C; and
- The information furnishing, recordkeeping, anti-evasion and severability provisions of subpart D.
- When the various provisions take effect; and
- For every financial institution, between now and next June:
- Policies and procedures must be developed or revised;
- Training must be completed; and
- Systems must be developed or updated.
Who Should Attend
The program is designed for lending department management, operations staff, lenders, compliance officers, auditors, and everyone involved in implementing the new rules or adapting current offerings to avoid the compliance burden.
Jack Holzknecht is the CEO of Compliance Resource, LLC. He has been delivering the word on lending compliance for 44 years. In 39 years as a trainer over 147,000 bankers (and many examiners) have participated in Holzknecht’s live seminars and webinars. Holzknecht’s career began in 1976 as a federal bank examiner. He later headed the product and education divisions of a regional consulting company. There he developed loan and deposit form systems and software. He also developed and presented training programs to bankers in 43 states. Holzknecht has been an instructor at compliance schools presented by a number of state bankers associations. As a contractor, he developed and delivered compliance training for the FDIC for ten years. He is a Certified Regulatory Compliance Manager and a member of the National Speakers Association.
Robin Cooper, CRCM is the Director of Compliance for Compliance Resource, LLC, a source of compliance assistance for financial institutions. Cooper’s career in banking began in 2004. Since that time she has worked for community and regional financial institutions ranging from $100 million to $1 billion in asset size regulated by the Office of the Comptroller of the Currency (OCC) and Federal Reserve Board (FRB). Cooper has worked in numerous compliance and banking roles, including Compliance Auditor, Internal Auditor, BSA Officer, and Compliance Officer. In 2010 Cooper established and led the, now longstanding, Central Kentucky compliance roundtable for compliance officers in central and southern Kentucky to convene and discuss emerging compliance issues. Cooper has a bachelor’s degree in Government from Centre College, attended the American Bankers Association National Compliance School, and is a Certified Regulatory Compliance Manager.
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