Statistics obtained through a FOIA request confirm what everyone expected – an uptick in CFPB enforcement activity that coincides with the beginning of the Biden Administration. Last year, we reported on statistics showing the number of new enforcement investigations opened every fiscal year through FY2019. Those statistics showed that new enforcement investigations had dropped significantly the year that Mick Mulvaney took over the CFPB—from 63 new investigations in FY2017 to just 15 new investigations in FY2018. That number climbed slightly to 20 new investigations in FY2019, which roughly coincided with Kathy Kraninger’s first year in office. Recently released CFPB statistics show that those numbers continued to climb—54 new enforcement investigations were opened in FY2020 (which ended shortly before the election) and 64 new enforcement investigations were opened in FY2021, which included the last four months of Kraninger’s tenure and the eight months that Dave Uejio served as Acting Director.
As a frame of reference, the CFPB’s most active years were FY 2013 and FY 2014, when Enforcement opened 104 and 99 new investigations, respectively. Those were the CFPB’s early years, however, when it first gained its authorities and was ramping up its Office of Enforcement. From FY2012 (the first full fiscal year when the CFPB had enforcement authority) through the end of FY2017 (the end of Richard Cordray’s tenure), the CFPB averaged 72 new investigations per year.
Last year, we also noted that the number of matters referred to the CFPB’s Action Review Committee (“ARC”) had dropped sharply in FY2018 under Mick Mulvaney, from 58 in FY2017 to 24 in FY2018. The ARC is the process by which the CFPB decides whether legal violations uncovered in the course of a supervisory examination should be resolved via supervision (non-public resolution with no civil money penalties) or enforcement (public resolution, typically involving civil money penalties). As with enforcement investigations, recently released statistics show that the downswing in ARC referrals was temporary, with 39 referrals in FY2109 and 44 referrals in each of FY2020 and FY2021. Most strikingly, however, the percentage of ARC matters referred to enforcement (in whole or in part) increased sharply in FY2021 to a near-record high of 41%, as compared to an overall referral rate of 28% from FY2013-2020.
We expect these recent trends in increasing numbers of new enforcement investigations, driven in part by increased referrals from the ARC, to continue now that Rohit Chopra has been confirmed as the CFPB’s new Director.
Below is a table showing the number of ARC referrals and new enforcement investigations over the years:
|Fiscal Year||# ARC Matters||# ARC Referrals to ENF (full or partial)||% ARC Referrals to ENF (full or partial)||# ENF investigations opened|
* The ARC process was implemented mid-FY2012 so we have not included statistics for that year.
** The CFPB has provided conflicting data about the number of enforcement investigations opened in these fiscal years.