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114th Congress   }                                       {      Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                       {     114-329

======================================================================



 
          REFORMING CFPB INDIRECT AUTO FINANCING GUIDANCE ACT

                                _______
                                

November 9, 2015.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Hensarling, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 1737]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 1737) to nullify certain guidance of the Bureau 
of Consumer Financial Protection and to provide requirements 
for guidance issued by the Bureau with respect to indirect auto 
lending, having considered the same, report favorably thereon 
without amendment and recommend that the bill do pass.

                          purpose and Summary

     Introduced by Representative Guinta, H.R. 1737, the 
``Reforming CFPB Indirect Auto Financing Guidance Act,'' 
repeals the Consumer Financial Protection Bureau's (CFPB's) 
Bulletin 2013-02 titled Indirect Auto Lending and Compliance 
with the Equal Credit Opportunity Act, which was published on 
March 21, 2013. H.R. 1737 also requires the CFPB to follow a 
transparent process when issuing subsequent auto finance 
guidance.

                  Background and Need for Legislation

    Bulletin 2013-02 provides guidance to indirect auto lenders 
regarding fair lending risk under the Equal Credit Opportunity 
Act (ECOA).\1\ While this bulletin does not purport to offer 
guidance to auto dealers, which are explicitly exempted from 
CFPB regulation under the Dodd-Frank Wall Street Reform and 
Consumer Protection Act,\2\ it nevertheless raises significant 
concerns that the CFPB is flouting this statutory limitation 
because the bulletin's practical effect is to regulate dealers. 
Furthermore, the bulletin raises concerns among auto lenders 
because it asserts that ECOA allows for a ``disparate impact'' 
theory of liability in which a lender may be held liable for 
discrimination where a facially neutral lending practice 
disparately impacts minority borrowers, even where the lender 
did not intend to discriminate against them. The bulletin 
advises that, in order to avoid liability under ECOA, financial 
institutions having indirect lender relationships with auto 
dealers should either impose controls on dealer compensation 
policies or forbid dealers from charging retail interest rates 
on consumer auto loans altogether. Although the CFPB maintains 
that its bulletins are non-binding guidance, it is 
simultaneously aware that such guidance must be taken seriously 
by market participants, because just the cost of being 
subjected to a CFPB investigation, even if it does not result 
in a CFPB enforcement action, is enormous. Accordingly, the 
bulletin is tantamount to regulation, except without public 
notice or opportunity for comment. By issuing guidance which it 
knows will induce actionable reliance, the Bureau attempted to 
force lenders to require dealers to adopt a ``flat fee'' 
compensation model. In doing so, the Bureau seeks to regulate 
companies over which it has no statutory authority, and without 
even providing the due process afforded regulated companies 
under the Administrative Procedure Act.
---------------------------------------------------------------------------
    \1\See http://files.consumerfinance.gov/f/201303_cfpb_march_-Auto-
Finance-Bulletin.pdf.
    \2\See Dodd-Frank Section 1029.
---------------------------------------------------------------------------
    What makes the CFPB's apparent disregard of its 
jurisdictional limitations even more problematic is the 
weakness of its statistical ``proof'' that auto dealers have 
engaged in discriminatory lending. First, the CFPB does not 
have verifiable evidence that borrowers are minorities or other 
protected classes--it is illegal for auto dealers to collect 
such information. The CFPB ``determined'' borrowers' race, 
ethnicity, and gender, among other factors, by reviewing their 
names and making conclusions using Bayesian probability, also 
known as a ``proxy methodology''--in other words, the CFPB made 
what it believed to be good guesses based on a number of 
assumptions. Second, the extension of disparate impact theory, 
which began in employment discrimination cases and was later 
applied to housing discrimination cases, is problematic in the 
context of ECOA and auto lending. The theory requires one to 
assume that any statistically significant difference in 
interest rates paid by borrowers of different races, genders, 
or other protected characteristics must be the result of 
discrimination. However, there potentially exist a number of 
non-discriminatory explanations for certain groups paying 
higher interest rates than others--for example, different car 
model preferences, dealership locations, socio-economic 
factors, and financial sophistication.
    On June 20, 2013, 35 Members of the House of 
Representatives wrote the CFPB seeking ``all studies, analysis, 
and information it relied upon in developing its guidance 
document'' and ``the full set of details concerning its 
disparate impact methodology,'' including the proxies it used, 
the factors held constant, the metric used to measure pricing 
disparities, and the numerical threshold at which a pricing 
disparity constitutes an ECOA violation. Over a year later, and 
only after continuous pressure from Congress and industry 
stakeholders, the CFPB released a white paper detailing its 
disparate impact methodology for ascertaining fair lending 
liability for indirect auto lenders.\3\ The white paper 
described the CFPB's methodology for assessing disparate impact 
liability.
---------------------------------------------------------------------------
    \3\http://files.consumerfinance.gov/f/201409_cfpb_report_proxy-
methodology.pdf. The Bureau's proxy method is known as the Bayesian 
Improved Surname Geocoding method, or BISG.
---------------------------------------------------------------------------
    The CFPB's methodology has drawn significant criticism, 
including by the American Financial Services Association, which 
commissioned Charles River Associates (CRA) to review the 
Bureau's white paper. The CRA study, which was released on 
November 19, 2014, found significant flaws in the CFPB's proxy 
methodology.\4\ Based on 8.2 million vehicle contracts 
originated in 2012 and 2013, the study showed that the CFPB's 
proxy method overestimates minorities by as much as 41 percent, 
which calls into question the reliability of the CFPB's 
results. On the heels of the publication of the CRA study, 
industry stakeholders vociferously called for the CFPB to 
review its testing methodology, correct any errant bias, and 
release the findings of its revised methodology for public 
review before pursuing further action on the matter.
---------------------------------------------------------------------------
    \4\http://www.afsaonline.org/news_and_publications/
vehicle_finance_study.cfm.
---------------------------------------------------------------------------

                                Hearings

    The Committee on Financial Services' Subcommittee on 
Financial Institutions held a hearing examining matters 
relating to H.R. 1737 on April 15, 2015.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
July 28, 2015 and July 29, 2015, and ordered H.R. 1737 to be 
reported favorably to the House without amendment by a recorded 
vote of 47 yeas to 10 nays (recorded vote no. FC-55), a quorum 
being present.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
sole record vote in committee was a motion by Chairman 
Hensarling to report the bill favorably to the House without 
amendment. The motion was agreed to by a recorded vote of 47 
yeas to 10 nays (Record vote no. FC-55), a quorum being 
present.



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the findings and recommendations of 
the committee based on oversight activities under clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
are incorporated in the descriptive portions of this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee states that H.R. 1737 
will provide for the regulation of the auto loan industry 
pursuant to methodologically sound principles by (1) repealing 
the CFPB's Bulletin titled ``Indirect Auto Lending and 
Compliance with the Equal Credit Opportunity Act'' (Bulletin 
2013-02) and (2) requiring that the CFPB formulate any future 
guidance addressing the same subject based on public input 
after releasing the data and analysis supporting the proposed 
guidance, and after conducting a study on the costs and impacts 
of the proposal to consumers and women-owned, minority-owned, 
and small businesses.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                 Congressional Budget Office Estimates

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington DC, October 14, 2015.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1737, the 
Reforming CFPB Indirect Auto Financing Guidance Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Susan Willie.
            Sincerely,
                                                        Keith Hall.
    Enclosure.

H.R. 1737--Reforming CFPB Indirect Auto Financing Guidance Act

    H.R. 1737 would nullify a bulletin published by the 
Consumer Financial Protection Bureau (CFPB) that provides 
guidance to lenders who agree to finance the purchase of an 
automobile through a dealership in compliance with the Equal 
Credit Opportunity Act. The bill also would direct the CFPB, 
when proposing new guidance on this topic, to follow certain 
procedures to provide for public notice and to make all 
studies, data, and analyses used in developing the guidance 
available to the public.
    Based on information from the CFPB, CBO expects the agency 
would not prepare a replacement bulletin if H.R. 1737 were 
enacted. Because the bill would not affect the underlying 
statue or regulations to implement it, the Bureau can continue 
to enforce the Equal Credit Opportunity Act without the 
bulletin. Therefore, enacting H.R. 1737 would not affect the 
federal budget. Because enacting the bill would not affect 
direct spending or revenues, pay-as-you-go procedures do not 
apply.
    Enacting the bill would not increase net direct spending or 
on-budget deficits by more than $5 billion in any of the four 
10-year periods beginning in 2026.
    H.R. 1737 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    The CBO staff contact for this estimate is Susan Willie. 
The estimate was approved by H. Samuel Papenfuss, Deputy 
Assistant Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of the section 
102(b)(3) of the Congressional Accountability Act.

                         Earmark Identification

    H.R. 1737 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                    Duplication of Federal Programs

    Pursuant to section 3(g) of H. Res. 5, 114th Cong. (2015), 
the Committee states that no provision of H.R. 1737 establishes 
or reauthorizes a program of the Federal Government known to be 
duplicative of another Federal program, a program that was 
included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most 
recent Catalog of Federal Domestic Assistance.

                   Disclosure of Directed Rulemaking

    Pursuant to section 3(k) of H. Res. 5, 114th Cong. (2015), 
the Committee states that H.R. 1737 contains no directed 
rulemaking.

             Section-By-Section Analysis of the Legislation


Section 1. Short title

    This Section cites H.R. 1737 as the ``Reforming CFPB 
Indirect Auto Financing Guidance Act''

Section 2. Nullification of auto lending guidance

    This section states that Bulletin 2013-02 of the Bureau of 
Consumer Financial Protection (published March 21, 2013) shall 
have no force or effect.

Section 3. Guidance requirements

    This section amends Section 1022(b) of the Consumer 
Financial Protection Act of 2010 (12 U.S.C. 5512(b)) to provide 
that when proposing and issuing guidance primarily related to 
indirect auto financing, the CFPB must provide opportunity for 
public input and make the data and analysis supporting the 
proposed guidance publicly available subject to certain 
redactions under the Freedom of Information Act. The section 
further provides that the CFPB must consult with other federal 
authorities and conduct a study on the costs and impacts of the 
guidance to certain groups.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

               CONSUMER FINANCIAL PROTECTION ACT OF 2010



           *       *       *       *       *       *       *
TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

           *       *       *       *       *       *       *


Subtitle B--General Powers of the Bureau

           *       *       *       *       *       *       *


SEC. 1022. RULEMAKING AUTHORITY.

  (a) In General.--The Bureau is authorized to exercise its 
authorities under Federal consumer financial law to administer, 
enforce, and otherwise implement the provisions of Federal 
consumer financial law.
  (b) Rulemaking, Orders, and Guidance.--
          (1) General authority.--The Director may prescribe 
        rules and issue orders and guidance, as may be 
        necessary or appropriate to enable the Bureau to 
        administer and carry out the purposes and objectives of 
        the Federal consumer financial laws, and to prevent 
        evasions thereof.
          (2) Standards for rulemaking.--In prescribing a rule 
        under the Federal consumer financial laws--
                  (A) the Bureau shall consider--
                          (i) the potential benefits and costs 
                        to consumers and covered persons, 
                        including the potential reduction of 
                        access by consumers to consumer 
                        financial products or services 
                        resulting from such rule; and
                          (ii) the impact of proposed rules on 
                        covered persons, as described in 
                        section 1026, and the impact on 
                        consumers in rural areas;
                  (B) the Bureau shall consult with the 
                appropriate prudential regulators or other 
                Federal agencies prior to proposing a rule and 
                during the comment process regarding 
                consistency with prudential, market, or 
                systemic objectives administered by such 
                agencies; and
                  (C) if, during the consultation process 
                described in subparagraph (B), a prudential 
                regulator provides the Bureau with a written 
                objection to the proposed rule of the Bureau or 
                a portion thereof, the Bureau shall include in 
                the adopting release a description of the 
                objection and the basis for the Bureau 
                decision, if any, regarding such objection, 
                except that nothing in this clause shall be 
                construed as altering or limiting the 
                procedures under section 1023 that may apply to 
                any rule prescribed by the Bureau.
          (3) Exemptions.--
                  (A) In general.--The Bureau, by rule, may 
                conditionally or unconditionally exempt any 
                class of covered persons, service providers, or 
                consumer financial products or services, from 
                any provision of this title, or from any rule 
                issued under this title, as the Bureau 
                determines necessary or appropriate to carry 
                out the purposes and objectives of this title, 
                taking into consideration the factors in 
                subparagraph (B).
                  (B) Factors.--In issuing an exemption, as 
                permitted under subparagraph (A), the Bureau 
                shall, as appropriate, take into 
                consideration--
                          (i) the total assets of the class of 
                        covered persons;
                          (ii) the volume of transactions 
                        involving consumer financial products 
                        or services in which the class of 
                        covered persons engages; and
                          (iii) existing provisions of law 
                        which are applicable to the consumer 
                        financial product or service and the 
                        extent to which such provisions provide 
                        consumers with adequate protections.
          (4) Exclusive rulemaking authority.--
                  (A) In general.--Notwithstanding any other 
                provisions of Federal law and except as 
                provided in section 1061(b)(5), to the extent 
                that a provision of Federal consumer financial 
                law authorizes the Bureau and another Federal 
                agency to issue regulations under that 
                provision of law for purposes of assuring 
                compliance with Federal consumer financial law 
                and any regulations thereunder, the Bureau 
                shall have the exclusive authority to prescribe 
                rules subject to those provisions of law.
                  (B) Deference.--Notwithstanding any power 
                granted to any Federal agency or to the Council 
                under this title, and subject to section 
                1061(b)(5)(E), the deference that a court 
                affords to the Bureau with respect to a 
                determination by the Bureau regarding the 
                meaning or interpretation of any provision of a 
                Federal consumer financial law shall be applied 
                as if the Bureau were the only agency 
                authorized to apply, enforce, interpret, or 
                administer the provisions of such Federal 
                consumer financial law.
          (5) Guidance on indirect auto financing.--In 
        proposing and issuing guidance primarily related to 
        indirect auto financing, the Bureau shall--
                  (A) provide for a public notice and comment 
                period before issuing the guidance in final 
                form;
                  (B) make available to the public, including 
                on the website of the Bureau, all studies, 
                data, methodologies, analyses, and other 
                information relied on by the Bureau in 
                preparing such guidance;
                  (C) redact any information that is exempt 
                from disclosure under paragraph (3), (4), (6), 
                (7), or (8) of section 552(b) of title 5, 
                United States Code;
                  (D) consult with the Board of Governors of 
                the Federal Reserve System, the Federal Trade 
                Commission, and the Department of Justice; and
                  (E) conduct a study on the costs and impacts 
                of such guidance to consumers and women-owned, 
                minority-owned, and small businesses.
  (c) Monitoring.--
          (1) In general.--In order to support its rulemaking 
        and other functions, the Bureau shall monitor for risks 
        to consumers in the offering or provision of consumer 
        financial products or services, including developments 
        in markets for such products or services.
          (2) Considerations.--In allocating its resources to 
        perform the monitoring required by this section, the 
        Bureau may consider, among other factors--
                  (A) likely risks and costs to consumers 
                associated with buying or using a type of 
                consumer financial product or service;
                  (B) understanding by consumers of the risks 
                of a type of consumer financial product or 
                service;
                  (C) the legal protections applicable to the 
                offering or provision of a consumer financial 
                product or service, including the extent to 
                which the law is likely to adequately protect 
                consumers;
                  (D) rates of growth in the offering or 
                provision of a consumer financial product or 
                service;
                  (E) the extent, if any, to which the risks of 
                a consumer financial product or service may 
                disproportionately affect traditionally 
                underserved consumers; or
                  (F) the types, number, and other pertinent 
                characteristics of covered persons that offer 
                or provide the consumer financial product or 
                service.
          (3) Significant findings.--
                  (A) In general.--The Bureau shall publish not 
                fewer than 1 report of significant findings of 
                its monitoring required by this subsection in 
                each calendar year, beginning with the first 
                calendar year that begins at least 1 year after 
                the designated transfer date.
                  (B) Confidential information.--The Bureau may 
                make public such information obtained by the 
                Bureau under this section as is in the public 
                interest, through aggregated reports or other 
                appropriate formats designed to protect 
                confidential information in accordance with 
                paragraphs (4), (6), (8), and (9).
          (4) Collection of information.--
                  (A) In general.--In conducting any monitoring 
                or assessment required by this section, the 
                Bureau shall have the authority to gather 
                information from time to time regarding the 
                organization, business conduct, markets, and 
                activities of covered persons and service 
                providers.
                  (B) Methodology.--In order to gather 
                information described in subparagraph (A), the 
                Bureau may--
                          (i) gather and compile information 
                        from a variety of sources, including 
                        examination reports concerning covered 
                        persons or service providers, consumer 
                        complaints, voluntary surveys and 
                        voluntary interviews of consumers, 
                        surveys and interviews with covered 
                        persons and service providers, and 
                        review of available databases; and
                          (ii) require covered persons and 
                        service providers participating in 
                        consumer financial services markets to 
                        file with the Bureau, under oath or 
                        otherwise, in such form and within such 
                        reasonable period of time as the Bureau 
                        may prescribe by rule or order, annual 
                        or special reports, or answers in 
                        writing to specific questions, 
                        furnishing information described in 
                        paragraph (4), as necessary for the 
                        Bureau to fulfill the monitoring, 
                        assessment, and reporting 
                        responsibilities imposed by Congress.
                  (C) Limitation.--The Bureau may not use its 
                authorities under this paragraph to obtain 
                records from covered persons and service 
                providers participating in consumer financial 
                services markets for purposes of gathering or 
                analyzing the personally identifiable financial 
                information of consumers.
          (5) Limited information gathering.--In order to 
        assess whether a nondepository is a covered person, as 
        defined in section 1002, the Bureau may require such 
        nondepository to file with the Bureau, under oath or 
        otherwise, in such form and within such reasonable 
        period of time as the Bureau may prescribe by rule or 
        order, annual or special reports, or answers in writing 
        to specific questions.
          (6) Confidentiality rules.--
                  (A) Rulemaking.--The Bureau shall prescribe 
                rules regarding the confidential treatment of 
                information obtained from persons in connection 
                with the exercise of its authorities under 
                Federal consumer financial law.
                  (B) Access by the bureau to reports of other 
                regulators.--
                          (i) Examination and financial 
                        condition reports.--Upon providing 
                        reasonable assurances of 
                        confidentiality, the Bureau shall have 
                        access to any report of examination or 
                        financial condition made by a 
                        prudential regulator or other Federal 
                        agency having jurisdiction over a 
                        covered person or service provider, and 
                        to all revisions made to any such 
                        report.
                          (ii) Provision of other reports to 
                        the bureau.--In addition to the reports 
                        described in clause (i), a prudential 
                        regulator or other Federal agency 
                        having jurisdiction over a covered 
                        person or service provider may, in its 
                        discretion, furnish to the Bureau any 
                        other report or other confidential 
                        supervisory information concerning any 
                        insured depository institution, credit 
                        union, or other entity examined by such 
                        agency under authority of any provision 
                        of Federal law.
                  (C) Access by other regulators to reports of 
                the bureau.--
                          (i) Examination reports.--Upon 
                        providing reasonable assurances of 
                        confidentiality, a prudential 
                        regulator, a State regulator, or any 
                        other Federal agency having 
                        jurisdiction over a covered person or 
                        service provider shall have access to 
                        any report of examination made by the 
                        Bureau with respect to such person, and 
                        to all revisions made to any such 
                        report.
                          (ii) Provision of other reports to 
                        other regulators.--In addition to the 
                        reports described in clause (i), the 
                        Bureau may, in its discretion, furnish 
                        to a prudential regulator or other 
                        agency having jurisdiction over a 
                        covered person or service provider any 
                        other report or other confidential 
                        supervisory information concerning such 
                        person examined by the Bureau under the 
                        authority of any other provision of 
                        Federal law.
          (7) Registration.--
                  (A) In general.--The Bureau may prescribe 
                rules regarding registration requirements 
                applicable to a covered person, other than an 
                insured depository institution, insured credit 
                union, or related person.
                  (B) Registration information.--Subject to 
                rules prescribed by the Bureau, the Bureau may 
                publicly disclose registration information to 
                facilitate the ability of consumers to identify 
                covered persons that are registered with the 
                Bureau.
                  (C) Consultation with state agencies.--In 
                developing and implementing registration 
                requirements under this paragraph, the Bureau 
                shall consult with State agencies regarding 
                requirements or systems (including coordinated 
                or combined systems for registration), where 
                appropriate.
          (8) Privacy considerations.--In collecting 
        information from any person, publicly releasing 
        information held by the Bureau, or requiring covered 
        persons to publicly report information, the Bureau 
        shall take steps to ensure that proprietary, personal, 
        or confidential consumer information that is protected 
        from public disclosure under section 552(b) or 552a of 
        title 5, United States Code, or any other provision of 
        law, is not made public under this title.
          (9) Consumer privacy.--
                  (A) In general.--The Bureau may not obtain 
                from a covered person or service provider any 
                personally identifiable financial information 
                about a consumer from the financial records of 
                the covered person or service provider, 
                except--
                          (i) if the financial records are 
                        reasonably described in a request by 
                        the Bureau and the consumer provides 
                        written permission for the disclosure 
                        of such information by the covered 
                        person or service provider to the 
                        Bureau; or
                          (ii) as may be specifically permitted 
                        or required under other applicable 
                        provisions of law and in accordance 
                        with the Right to Financial Privacy Act 
                        of 1978 (12 U.S.C. 3401 et seq.).
                  (B) Treatment of covered person or service 
                provider.--With respect to the application of 
                any provision of the Right to Financial Privacy 
                Act of 1978, to a disclosure by a covered 
                person or service provider subject to this 
                subsection, the covered person or service 
                provider shall be treated as if it were a 
                ``financial institution'', as defined in 
                section 1101 of that Act (12 U.S.C. 3401).
  (d) Assessment of Significant Rules.--
          (1) In general.--The Bureau shall conduct an 
        assessment of each significant rule or order adopted by 
        the Bureau under Federal consumer financial law. The 
        assessment shall address, among other relevant factors, 
        the effectiveness of the rule or order in meeting the 
        purposes and objectives of this title and the specific 
        goals stated by the Bureau. The assessment shall 
        reflect available evidence and any data that the Bureau 
        reasonably may collect.
          (2) Reports.--The Bureau shall publish a report of 
        its assessment under this subsection not later than 5 
        years after the effective date of the subject rule or 
        order.
          (3) Public comment required.--Before publishing a 
        report of its assessment, the Bureau shall invite 
        public comment on recommendations for modifying, 
        expanding, or eliminating the newly adopted significant 
        rule or order.

           *       *       *       *       *       *       *


                             MINORITY VIEWS

    H.R. 1737 would nullify the Consumer Financial Protection 
Bureau's (``CFPB'' or ``Bureau'') March 2013 bulletin 
(``Bulletin'') that clarifies the Bureau's authority to 
regulate indirect auto lenders under the Equal Credit 
Opportunity Act (``ECOA'') and that establishes its supervisory 
and enforcement expectations concerning indirect auto lender 
compliance with ECOA's fair lending requirements. In nullifying 
the Bulletin, H.R. 1737 seeks to impose unprecedented 
restrictions on the Bureau's issuance of important regulatory 
guidance and is unnecessary in light of the Bureau's Summer 
2014 white paper explaining its methodology for identifying 
violations of ECOA and its implementing regulation, Regulation 
B.
    The intent of H.R. 1737 is to send a clear message from 
Congress to the CFPB that lawmakers disapprove of the Bureau's 
recent actions to root out discriminatory practices among auto 
lenders. However, Members of Congress who were supportive of 
the creation of the CFPB and its mission believe enforcing 
these fair lending laws is precisely what the Bureau was 
designed to do. To date, the CFPB has reached settlements with 
several large lenders that have agreed to improve their fair 
lending compliance and return money to harmed consumers. The 
Bureau has provided thorough and timely information to Congress 
on these enforcement actions.
    During the 113th Congress, similar legislation was proposed 
(H.R. 5403) and two separate inquiries from House Democrats and 
Republicans were made questioning the Bulletin and requesting 
details concerning the process that the Bureau uses to identify 
potential fair lending violations. The CFPB responded in Summer 
2014 with a white paper responsive to the concerns raised by 
members that provides extensive detail into its methodology for 
identifying and analyzing potential fair lending violations.
    The Bulletin provides important guidance on the Bureau's 
supervisory and enforcement expectations for indirect auto 
lenders. If enacted, H.R. 1737 would nullify guidance that to 
date has been helpful to regulated entities as they develop and 
refine their fair lending compliance management programs. H.R. 
1737 does not alter regulated entities' obligations under ECOA 
or the CFPB's examination or enforcement activity pursuant to 
ECOA. Consequently, the practical effect of H.R. 1737 would be 
to nullify important information relied upon by regulated 
entities during a period of heightened regulatory scrutiny 
while also undermining indirect auto lenders' fair lending 
compliance management programs.
    For the foregoing reasons, the Minority opposes H.R. 1737.

                                                     Maxine Waters.
                                                Carolyn B. Maloney.
                                                     Wm. Lacy Clay.
                                                        Gwen Moore.
                                                  Gregory W. Meeks.

                                  [all]