CFPB issues policy statement on billing error responsibilities, two sets of Covid-19 FAQs
On May 13, the CFPB released a policy statement and two FAQ documents outlining the responsibilities of financial firms during the Covid-19 pandemic. The policy statement covers Regulation Z’s billing error resolution timeframe in light of the operational disruptions faced by many merchants and small businesses, causing delays in responses to creditors’ inquiries and thus making it difficult for creditors to accurately and timely resolve consumers’ billing error notices. The statement emphasizes that the CFPB will be flexible with its supervisory and enforcement approach during the pandemic as it relates to billing error resolution set forth in §1026.13(c)(2), stating “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 [Regulation Z] 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.” The Bureau notes that creditors are still expected to fully comply with the other requirements of billing error disputes in Regulation Z.
The Bureau also released payment and deposit rule FAQs related to the Covid-19 pandemic, which state that financial or depository intuitions may change account terms due to the pandemic so long as they provide appropriate notice to consumers. However, if a change is favorable to the consumer, it can be implemented immediately without advance notice. Additionally, the Bureau released open-end (not home-secured) rule FAQs related to the Covid-19 pandemic, which state that creditors may change account terms in response to the pandemic but most changes will require advance notice. However, changes that may help a consumer in need—such as reducing a finance charge—do not require advance notice.