Inquiry into Consumers' Access to Digital Financial Records Suggests Regulations Forthcoming
The Consumer Financial Protection Bureau (CFPB) seeks information relating to consumer access to digital financial account information. On Nov. 17, 2016, it published a Notice and Request for Information in the Federal Registrar with 20 questions aimed at soliciting information from industry actors about the challenges faced by consumers in accessing and sharing access to their digital account information.
In its Notice, the CFPB acknowledged the growth of services and companies that use consumers’ financial account information to provide analysis and consumer financial management tools. The CFPB recognized that companies often use consumer-permissioned access in gathering and aggregating consumer data. Approvingly, the CFPB indicated its desire to foster an environment where financial service providers can securely obtain, with the consumer’s permission, the information needed to deliver innovative products and services that benefit consumers.
Yet the CFPB also laced its statements with expectations for this emerging market. The CFPB emphasized that all data access and sharing must be done securely and with the consumer's permission. According to CFPB Director Richard Cordray, "[t]echnology provides opportunities to use [consumer] records to create new consumer tools that help improve financial lives. To realize that potential, we are launching a public inquiry into how much control consumers have over their records and how easy and secure it is for them to share their records with third parties."
The CFPB has taken the position that Congress has recognized consumers’ growing need to obtain and use their digital account information. Specifically, the Dodd-Frank Wall Street Reform and Consumer Protection Act provides for consumer rights to access their financial records and account-related information, and specifies that this information "shall be made available in an electronic form usable by consumers."
Dodd-Frank also gave rulemaking authority over this area to the CFPB. The CFPB's inquiry strongly suggests that the Bureau will seek to promulgate rules governing consumer access to financial records. The comments submitted to the Bureau in response to its Notice will likely shape not only any such rules, but also CFPB supervisory and enforcement actions.
Comments are due to the CFPB by February 21, 2017.