In recent weeks, there have been two significant developments involving Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Consumer Financial Protection Bureau (CFPB) issued a comprehensive set of Frequently Asked Questions (FAQs) on June 28, 2023, to aid small business lenders and finance companies in compliance with a final rule mandated by Section 1071. Additionally, a court has issued a limited injunction affecting the rule.
The CFPB’s issuance of these FAQs, as analyzed in this JD Supra article, is vital to small business lenders and finance companies that work under the legal guidelines set by Section 1071 of the Dodd-Frank Act. Section 1071 obligates financial institutions to collect and report information about loan applications made by women-owned, minority-owned and small businesses.
- Intersection of section 1071 with other statutes and regulations/li>
- Implementation timeline/li>
- Clarification on what constitutes a ‘small business’ for the purpose of data collection/li>
Notably, these FAQs offer much-needed advice and suggestions to these institutions on how to handle several aspects of data collection and reporting required by Section 1071, particularly those intricacies that intersect with other statutes and regulations.
Moreover, the concurrent court injunction may have a streamlined effect on the implementation of Section 1071. Legal professionals are advised to stay updated on these developments that can have significant implications for financial institutions’ compliance protocols.