On May 21, 2013, the Consumer Financial Protection Bureau (“CFPB”) and the Conference of State Bank Supervisors (“CSBS”) entered into the 2013 CFPB-State Supervisory Coordination Framework, a non-binding agreement providing guidance for cooperation between state and federal agencies regarding the supervision of providers of consumer financial products and services (the “Framework”). The primary purpose of the Framework is to achieve examination efficiencies and avoid duplication of time and resources by establishing procedures for the coordination of federal and state consumer protection supervision. The Framework will apply where the CFPB and state regulators share concurrent jurisdiction over the supervision of non-depository financial services providers of any size and insured state-chartered depository institutions or credit unions with more than $10 billion in assets.
The need for such guidance is in response to the Dodd-Frank Act’s creation of the CFPB and adds to the Memorandum of Understanding between the CFPB and the CSBS of 2011 (the “MOU”), which sets forth an agreement for the coordination and information sharing between regulators in supervision and enforcement matters. The Framework builds upon the MOU by providing the manner in which state and federal regulators should share the responsibilities of supervising and examining regulated financial institutions. Specifically, the Framework provides for the coordination of examination schedules in an effort to avoid duplicative examinations, the development of comprehensive supervisory plans, including the creation of a State Coordinating Committee responsible for state coordination with the CFPB with regard to supervision of non-bank entities, and the sharing of information between regulators regarding examinations and corrective actions. Note, while the parties have agreed the Framework will foster efficiencies among regulators and intend to work together to achieve these goals, it is a non-binding agreement, and, as a result, the CFPB and state regulators may still conduct examinations separate and apart from the procedures set forth in the Framework.