CFPB ends oversight agreement with Bank of America ahead of schedule

CFPB Ends Oversight of Bank of America Early

The Domestic foreign exchange transactionsConsumer Financial Protection Bureau (CFPB) formally ended a supervisory agreement with Bank of America (BofA) earlier this month, which was originally intended to last five years. This agreement stemmed from fines and oversight due to the bank's submission of inaccurate mortgage data.

According to a document filed on June 4, the CFPB confirmed that BofA had fulfilled all its obligations, prompting them to end the oversight three years early.

Fined for Inaccurate Mortgage Data

The oversight agreement initially began in November 2023 when the CFPB accused Bank of America of providing inaccurate mortgage applicant data to the federal government over an extended period, violating U.S. financial regulations.

Though BofA did not admit or deny any wrongdoing, it agreed to pay a fine of $12 million to settle these charges.

Under the original agreement, the CFPB planned to monitor the issue for five years unless there was reason to terminate it early.

Regulators Acknowledge Progress in Compliance

In the termination announcement, the CFPB noted that BofA had completed its corrective action plan and met all the requirements set by the regulators. On this basis, the CFPB decided to discontinue the oversight.

Although the CFPB has not responded to media requests for comment, the formal termination of the agreement indicates restored confidence in BofA's compliance practices.

Bank of America Does Not Comment

Bank of America has not issued an official comment regarding the early termination of the oversight.

Industry analysts believe the termination reflects the bank's substantive improvements in data governance and internal compliance.

However, some opinions suggest that whether BofA has fully resolved systemic data reporting issues remains to be seen, especially amid increasingly stringent housing credit audit standards.

Regulatory Flexibility and Goal-Oriented Approach Reflected

The event also highlights the CFPB's flexibility in enforcement. When a regulated entity demonstrates strong compliance and meets set corrective goals, regulators are willing to end interventions early, showcasing a "goal-oriented" regulatory approach.

Amid the current political and financial regulatory environment, such flexible regulatory mechanisms are gradually becoming a trend in U.S. financial regulation.

Data Compliance Under Renewed Scrutiny

With the development of financial technology and the expansion of data-intensive businesses, financial institutions face increasing pressure regarding data disclosure accuracy. This case serves as a reminder to banks and non-bank lenders alike that regulators are becoming stricter on data authenticity, with significant increases in non-compliance costs.

Looking ahead, whether the CFPB will implement similar regulatory mechanisms for other large financial institutions remains to be seen.

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