CFPB Proposes Rule Governing the Confidentiality of Privileged Information Provided to the Bureau

CFPB

On March 12, the CFPB released a proposed rule to govern the confidential treatment of privileged information submitted to the Bureau by the financial institutions it regulates. The proposed rule, which would amend 12 C.F.R. part 1070, subpart D, would add a new section providing that a person’s submission of any information to the CFPB in the course of the CFPB’s supervisory or regulatory processes would not waive or otherwise affect any privilege that such person might claim under federal or state law with respect to the submitted information. In the preamble to the proposed rule, the CFPB notes that although the Dodd-Frank Act did not explicitly address whether the submission of confidential information to the CFPB affects any privilege a supervised entity might claim, the Dodd-Frank Act did grant the CFPB all the powers and duties of the prudential regulators regarding their transferred consumer financial protection functions. The CFPB concludes that this grant of powers and duties includes the ability to receive privileged information from supervised entities without resulting in a waiver of any privileges. The CFPB added that its proposed rule is promulgated pursuant to Congress’s delegation of authority to the CFPB to prescribe rules governing the confidential treatment of information obtained from persons during its exercise of its authority. In addition to providing for the non-waiver of privilege when submitting information to the CFPB, the proposed rule provides that the CFPB’s provision of privileged information to another federal or state agency would not waive any applicable privilege, whether the privilege belongs to the CFPB or any other person. Comments on the proposed rule must be submitted on or before April 16, 2012.