Removing Barriers Blog

CFPB FAQs released outline billing error responsibilities
Posted May 14, 2020 by CUNA Advocacy

The Consumer Financial Protection Bureau (CFPB) this week released a statement and frequently asked questions (FAQs) document outlining the responsibility of credit card issuers and open-end non-home secured creditors during the pandemic. The statement outlines billing error responsibilities under Regulation Z, while the FAQs cover the payments and deposits rule and the open end (not home-secured) rules.

According to the statement, the CFPB will take a flexible supervisory and enforcement approach during the pandemic regarding the timeframe within which creditors complete their investigations of consumers’ billing error notices.

In evaluating the compliance with the maximum timeframe for billing error resolution, “the Bureau intends to consider the creditor’s circumstances and does not intend to cite a violation in an examination or bring an enforcement action against a creditor that takes longer than required by the regulation to resolve a billing error notice, so long as the creditor has made good faith efforts to obtain the necessary information and make a determination as quickly as possible, and complies with all other requirements pending resolution of the error.”

Good faith efforts from creditors can include obtaining a reasonable estimate from the merchant of when it will be able to respond, or determining reasonably that the merchant is unable to respond to the creditor’s request for information for the time being.

The payments rule document answers:

  • Can a financial institution (FI) or a depository institution (DI) change account terms for consumer checking, savings, or prepaid accounts due to the pandemic
  • Can an FI or DI immediately change account terms for consumer checking, savings, or prepaid accounts to provide relief
  • Are there other means for checking, savings, or prepaid account providers to provide consumers with immediate relief

The open-end (not home-secured) document answers:

  • Can a creditor that extends open-end (not home-secured) credit, such as a credit card issuer, change account terms for a consumer due to the pandemic
  • If a creditor that extends open-end (not home-secured) credit, such as a credit card issuer, arranges hardship relief, must the creditor give advance written notice of any increase in charges or payments that will follow completion of, or failure to complete, the arrangement
  • How else can creditors engage with consumers to assist them during the COVID-19 pandemic?