NACARA ANNUAL MEETING 2014 STATE COORDINATING COMMITTEE AND THE CFPB Charles A. Vice, Kentucky DFI Commissioner Edwin Chow, CFPB Regional Director Moderator: Chuck Cross, CSBS The Path to Coordination Coordinated Bank Supervision MMC Agreement 2010 DoddFrank CFPB/State Framework Info Sharing MOU CFPB Standup State Governance Agreement 2014 Exam Schedule 2015 Exam Schedule SCC Members ASSOCIATION REPRESENTATIVE CSBS Charles A. Vice, KY Manny Flores, IL NACCA Steven O’Shields, TX Joe Crider, MO NACARA Mike Larsen, ID Carmine Costa, CT MTRA Doug Buras, LA Robin Lobb, KS AARMR Cindy Begin, MA Rod Carnes, GA NASCUS Linda Jekel, WA Mary Ellen O’Neil, CT Support Staff Chuck Cross, CSBS Sabrina Cotter, NASCUS CFPB Coordination Leadership REGION REPRESENTATIVE West Edwin Chow – Primary Coordination RD Northeast Steve Kaplan – Regional Director Midwest Anthony Gibbs – Regional Director Southeast James Carley – Regional Director Headquarters Steve Antonakes David Bleicken Chris Young Clay Coon Nick Krafft What is NACARA’s Role in Coordination? • Voting member of the SCC with 2 reps • Leadership on debt collection supervision The Framework – 05/20/2013 Responsibilities: Coordinate Examination Schedules Quarterly Update Meetings Independent Examination Schedules Designation of SPC & EIC Necessary Processes & Additional Protocols Notices Corrective Actions Subject to this Framework Enforcement of Laws, Support Desirables: Exchange of Information on Independent Exams Exchange of Information on Non-Independent Exams Coordinated Examination Schedule • Develop a list of covered entities - The CFPB and the SCC will annually develop a list of Covered Non-Depository Entities that are potentially subject to examination. • MMC: Mortgage Origination and Servicing • NACCA: • Payday Lending • Student Lending • Auto Finance • NACARA: Debt Collector • MMET: Money Transmission, Emerging Payments, VC • Identify list of entities to examine - The SCC and the CFPB will identify Covered Non-Depository Entities that are to be examined under this Framework. Exchange of Information Secure means of transfer from CFPB to the States CSBS filter by MOU and statutory authority Archiving CFPB documents Secure delivery upon authority confirmation Email today . . . Website coming soon! Secure means of transfer from States to CFPB CSBS collection of related documents and forward delivery; or CSBS notification and facilitation of individual state delivery to CFPB Maintenance and protection of information Initially for multi-state; phase in single state CFPB Examination Procedures • Compliance Risk Management Assessment – Focus of review – Part of examination – Time to complete • Industry Product Line (IPL) • Request Letter • Supervisory Letters and Reports of Examination • Enforcement Actions State Examination Procedures • Mortgage: MMC management and processes – Established and mature – ComplianceEase software for origination exams • Debt Collection: NACARA – Processes in development • Payday Lending: NACCA – IL has the lead for the first exam – Process development early 2015 – Modify CFPB procedures to fit states – Work group will be established • Money Transmitters: MMET – Larger participant rule gives green light – Much work to be done SCC Expectations • Robust Multi-state Examination Process • Identification of Entities to Examine • Information Flow – CSBS as intermediary – Now – CSBS to States – CSBS Information request – regulatory authority – Future – States to CSBS • Feedback on Process – how do we make it better? State System is Complicated • There are ultimately 102 agencies to coordinate across at least 9 industries • We can only do this together • Coordination means both multi-state and inter-agency • Single Points of Contact (SPCs) in your agency are our lifeline – keep them current 2014 Coordinated Exam Schedule • 6 Mortgage Exams – Origination – Servicing • 2 Debt Collector Exams • 1 Payday Lender Exam 2014 Examination Participation • MMC is overseeing mortgage for the SCC • In the first 3 mortgage exams: – 47 states & 92 examiners are participating – All 4 CFPB Regions • Debt Collection led by CT and ID – 8 states are participating in two exams – 2 CFPB Regions 2015 Proposed Schedule • 12 to 19 Exams Proposed • Industries to be examined:* – – – – – Mortgage Origination (3-5 exams) Mortgage Servicing (3-4 exams) Payday Lending (1-3 exams) Debt Collection (3 exams) Money Transmitter (2-4 exams) * Based on how you count the #s. What is Next? • Ultimate Goal – more coordinated examinations – Leverage off each other’s work – Reduced burden on regulated entity – Coordinated Supervisory Actions • Task Force – January 2015 – Review prior coordinated examinations – Coordinated Request Letter – Coordinated Examination Process – Coordinated Report QUESTIONS?