The CFPB could soon be joining the efforts of other federal regulators and New York authorities to deny ACH network access to certain online payday lenders and other businesses deemed to present risks to consumers.  In remarks last week to The Clearing House Annual Conference, Director Cordray spoke about the need to protect consumers “who find unexpected debits on their bank statements, or are victimized by third parties who may take inappropriate advantage of the efficiency and trust on which [the electronic payment] systems are built.”  

He stated that the CFPB was interested in working with The Clearing House to improve the Bureau’s understanding “of how enhanced computer analytics and communications could be used to map patterns in the payment systems” and that finding such patterns could enable the CFPB to “identify outliers that are unusually frequent sources of irregular or failed claims for payment.”  Director Cordray indicated that the CFPB wants to “be better able to identify and enforce the law against illegitimate firms that are otherwise able to reduce their own costs by hitching a free ride on the payments system” and place itself in “a better position to consider changes in law or practice that may be needed. ” 

In his remarks, Director Cordray referenced the proposed rule changes recently issued by NACHA that are intended to improve the functioning of the ACH network.  We have prepared a legal alert discussing the NACHA proposal.  In addition, on January 7, 2014, from 12 1 p.m. ET, Ballard lawyers will conduct a webinar, “ACH Access Under Siege.”  The registration form is now available.