The Consumer Financial Protection Bureau is not planning to enforce Section 1071, the bureau announced on April 30. .“The bureau will instead keep its enforcement and supervision resources focused on pressing threats to consumers, particularly servicemen and veterans,” the bureau wrote in a May 1 press release. “The bureau takes this step in the interest of focusing resources on supporting hard-working taxpayers, servicemen, veterans and small businesses.” Section 1071, which was finalized last year under the Biden administration, would have required collecting and submitting data on credit applications by women-owned, minority-owned and small businesses. Lenders would have needed to furnish data on loans made to small businesses with less than $5 million in the last fiscal year, submit Congressionally-required data points and provide additional information typically included in lender files.The bureau’s announcement came after the Fifth Circuit Court of Appeals granted a stay in enforcement of the rule in a lawsuit filed by the Texas Bankers Association, American Bankers Association and other groups.“Even absent resource constraints, the bureau would deprioritize enforcement of this rule because of the unfairness of enforcing it against entities not protected by the court’s stay but similarly situated to parties that are protected by the stay,” according to the CFPB. “The bureau looks forward to resolving the status of this regulation and ensuring fair, consistent treatment for all entities impacted by the regulation.”
