The Consumer Financial Protection Bureau (CFPB) recently submitted a plan for approval of collecting information with the Office of Management and Budget. The comment period for this effort ended Oct. 9 with a pair of groups questioning the CFPB’s proposal.
The CFPB was looking to conduct controlled trials in field and economic laboratory settings, it said in the generic information collection plan. The research would be used for “developmental and informative purposes, but not directly providing a basis for specific policy.”
Topics the CFPB said it was interested in studying included:
- Consumer awareness and decision-making, for example, understanding what financial products or features people are aware of and why they choose one product over another;
- Consumer experiences and potential risks to consumers, including traditionally underserved consumers;
- Information disclosure and how disclosure may affect behavior;
- The effect of educational or other interventions on consumer financial behavior or outcomes.
“These topics will usually be in the context of consumer financial product markets, including mortgages, car loans, student loans, installment loans, small dollar loans and credit, debit, and prepaid cards,” the proposal said. “In addition, research may be related to the CFPB’s mission regarding financial education, including evaluating the effectiveness of financial education programs and understanding financial planning behaviors, including savings and spending behavior. The CFPB envisions that the research covered under this generic clearance will be basic research about consumer credit markets and household finance.”
Two groups, the U.S. Chamber of Commerce and ACA International, the association of credit and collection professionals, filed comment letters in the 30-day period. Both wanted the CFPB to make specific requests for their collection proposals rather than initiating them through the generic information collection plan.
“Here, given the broadly worded Supporting Statement for the generic request, it is clear that the bureau intends to collect data that will undoubtedly raise substantive or policy issues, regardless of how the bureau claims the data will ultimately be used (or not used),” the ACA comment letter said. “The bureau’s own stated goal of the generic collection — to ‘allow the bureau to better inform and advance scientific understanding of consumer credit markets and household finance’ — is nothing like the benign customer satisfaction surveys, focus group testing, and website usability surveys that (the Office of Information and Regulatory Affairs) cited as examples for generic request. While the bureau might find obtaining generic clearance to be more convenient and efficient, the request under review simply does not merit this streamlined process which will improperly deprive stakeholders of important opportunities to meaningfully participate. As a result, the bureau should revise its collection request to align with the (Paperwork Reduction Act’s) requirements and to affirm the president’s principles of transparency, public participation and collaboration.
“While ACA applauds the bureau’s efforts to obtain data to support its mission, ACA objects to the bureau’s reliance on a vague generic collection request which lacks sufficient detail for interested parties to assess the fundamental components of the collection.”
The Chamber of Commerce had similar thoughts on the matter, saying that it applauded the CFPB’s effort to gather appropriate data for its work, but that the generic collection proposal did not provide the necessary transparency and public participation.
“The proposed covered data collections would be similar in form in that each would involve ‘controlled trials in field and economic laboratory settings.’ Beyond that, however, what data collections the bureau actually would pursue is unclear,” its letter said. “Therefore, the covered data collection appears to be overbroad, imposes significant burdens on respondents, raises privacy concerns, and frustrates the requirements and intent of the Paperwork Reduction Act. Rather than provide clear notice of what data collections it actually will perform, the bureau repeatedly offers only uncertainty.
“In sum, the Generic Collection Proposal leaves enormous uncertainty about the data collections that the bureau actually would pursue if approved,” the letter continued. “Instead, it ultimately only reveals that the bureau plans ‘to gather primary data from purposive samples through controlled trials in field and economic laboratory settings.’ The bureau, in other words, is seeking approval for an entire means of information collection. Given its stated commitment to transparency and public engagement, as well as the requirements of the Paperwork Reduction Act, the bureau should proceed with individual proposals for the covered information collections. Alternatively, the bureau should issue a series of detailed generic collection proposals that cover clearly defined and easily understood categories of ‘very similar’ collections.”