On January 3, 2023, American Bankers Association, America’s Credit Unions, and Independent Community Bankers of America wrote a letter to CFPB Director Rohit Chopra to address their concerns that the CFPB’s proposal for rulemaking on non-sufficient funds (NSF) and overdraft fees triggers the statutorily required Small Business Regulatory Enforcement Fairness Act (SBREFA) review as the rulemaking will have a significant economic impact on banks and credits unions with assets of $850 million or less. The trade groups commented:
The Bureau’s most recent semiannual Rulemaking Agenda, issued last month, states that in the coming days, the Bureau projects to issue proposals to regulate NSF fees using the Bureau’s authority to prevent unfair, deceptive or abusive practices and to define overdraft fees as credit subject to the Truth in Lending Act and Regulation Z. The Bureau, however, has not initiated a SBREFA review for either of these rulemakings, so one can only conclude that the Bureau intends to skip this critical step in the rulemaking process.
Regrettably, this would not be the first time the CFPB has disregarded the SBREFA requirement. These same trade groups sent a very similar letter to the CFPB prior to the credit card late fee rulemaking. Yet, the CFPB pushed forward without conducting a SBREFA review, causing 17 Republican members of the House Financial Services Committee to send a letter to Director Chopra and the U.S. Small Business Administration to submit a public comment letter critiquing the proposed rule. As we previously blogged, the CFPB issued a report last month in an attempt to bolster its planned overdraft and NSF fee rulemaking which we expected would be issued in December.