Consumer Protection Attorney Shares CFPB Battle Stories

There’s much more to a Consumer Financial Protection Bureau investigation or exam than just complying with its requests for information and documents. Anthony DiResta, partner at Winston & Strawn LLP, made that abundantly clear at insideARM.com’s May webinar outlining the closeout process with the CFPB.

“I was involved in a recent investigation, a formal law enforcement investigation with the CFPB, where we had an outstanding outcome. I received a closing letter. No action was required. There was no publicity whatsoever,” DiResta said.

Getting to closeout, however, was a two-year process from when the company received a Civil Investigative Demand (CID) from the Bureau. From there, the agency started going through its print and electronic documents – from written compliance policies to employees’ emails – with a fine-tooth comb. The CFPB had specific electronic production protocol that it mandated throughout the investigation, and collection agencies need to make sure that they provided detailed electronic documentation without doing a messy “data dump.”

Furthermore, the agency took the step of being its own best advocate. They created reports for the CFPB, and responded to interrogations, hearings and depositions. All this was done to put them in a position where they could negotiate with the CFPB instead of wait with baited breath for the Bureau to find any kind of violation or penalty.

“We had to submit legal positions or white papers, we met and negotiated with the CFPB, all of that,” DiResta said. “But obviously a very labor-intensive process, very stressful, crisis-related process. But the good news for all of us: they closed the investigation.So, if you get one of these subpoenas or CIDs that does not mean your world is coming to an end. It’s a question of successful navigation of the process.”

Since this investigation ended without penalty, the name of the agency in question was not publicly released; DiResta would not comment on the name of the company, except to say that it was a larger market participant in the debt collection industry.

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Get more of the key points from DiResta’s presentation in our newest report, To the Point: Closeout with the CFPB. Learn how to successfully survive an investigation or examination and build a culture of compliance that will withstand CFPB scrutiny. Get insider tips for being your own best advocate with easy-to-use charts and checklists.

Collection agencies need real-world insider information about how to successfully navigate investigations and exams with the CFPB. If handled correctly, they can be opportunities to generate good PR by closing out the investigation penalty-free. DiResta shows that it has been done before.