Yesterday, the CFPB issued its final rule defining larger participants of the student loan servicer market. The final rule becomes effective on March 1, 2014. Consistent with the proposed rule, the final rule defines larger participants to mean servicers with an “account volume” exceeding 1 million.
The final rule, which is based on the CFPB’s Dodd-Frank authority to supervise nonbank entities considered to be “a larger participant of a market for other consumer financial products or services,” significantly expands the Bureau’s supervisory authority over nonbank student loan servicers. When the final rule takes effect on March 1, the CFPB will begin examining entities that qualify as larger participants.
Our Consumer Financial Services Group has created a team of lawyers who are helping nonbanks prepare for CFPB examinations and respond to CFPB civil investigative demands. On
December 18, members of this team will be conducting a webinar, “Is It the School of Hard Knocks for Larger Student Loan Servicers?” A registration form is now available.
For more information on the final rule, see our legal alert.