In response to a legal challenge brought by small business owners and community development organizations, the Trump administration has finally agreed to stop flouting its legal obligation to facilitate enforcement of anti-discrimination laws that protect women-owned, minority-owned and small businesses from discriminatory financial institutions.
Pursuant to a settlement agreement filed with the U.S. District Court for the Northern District of California, the Consumer Financial Protection Bureau will agree to concrete court-ordered deadlines for implementing Section 1071 of the Dodd-Frank Act, which requires the agency to collect and disclose data on discriminatory lending to America’s small businesses. After unlawfully delaying this requirement for years, the CFPB must also submit status reports updating the public on its progress.
According to the agreement, the CFPB will:
By September 2020, outline its proposals for collecting the required data and publicly release those proposals for consideration of their effect on small businesses;
By October 2020, establish a Small Business Advocacy Review panel to provide input on its proposal. CFPB will take panelist suggestions from the small business plaintiff groups;
Negotiate deadlines with the plaintiffs for each stage of the rulemaking process to facilitate the data collection, including the deadline to issue the final data collection rule, and accept Court-ordered deadlines if the parties cannot agree; and
Submit status reports every 90 days detailing the CFPB’s progress toward implementing this data collection rule.
The joint settlement agreement was submitted to the Court on Wednesday, February 26, 2020 and is subject to final Court approval.