On January 11, Elena Babinecz, a CFPB attorney, spoke as part of a panel relating to the revised HMDA rule at the Winter Meeting of the Consumer Financial Services Committee of the Business Law Section of the American Bar Association.  Ms. Babinecz confirmed that the CFPB is engaged in a follow-up policymaking process to allow the public to provide input on privacy concerns relating to new data that those subject to HMDA’s reporting requirements are required to collect, record and report.

As we have previously reported, the new HMDA rule includes numerous new data points.  For example, Covered Institutions will be required to collect, record and report information about applicants and borrowers, including age, credit score, and debt-to-income ratios.  Moreover, for data collected in or after 2018, the new rule will require a Covered Institution to allow applicants to self-identify ethnicity or race using disaggregated ethnic and racial subcategories, which information will be reported accordingly.

Ms. Babinecz acknowledged that the CFPB received comments on the rule drawing attention to the fact that many of these new data points implicate important privacy rights.  We agree that privacy is a critical issue, and join those who have raised concerns about expansion of data points under the new rule.  For example, the new rule will require Covered Institutions to collect and record sensitive information about individuals, which will be accompanied by additional data security burdens.

The CFPB has not provided details on how it intends to ensure that the sensitive information about consumers that will be reported to, and maintained by, the CFPB will be protected from unauthorized access or disclosure.  Finally, while the public will be able to obtain HMDA data using the new Internet-based tool being built by the CFPB, what portion of the reported data will be made publicly available is still under consideration by the CFPB.

We look forward to learning more about the CFPB’s policymaking relating to data privacy under the new HMDA rule.