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ARTICLE · 12 FEBRUARY 2025

CFPB Signals Shift In Position On Section 1071

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This week, the CFPB filed an emergency notice in the Fifth Circuit Court of Appeals, indicating that it no longer opposes a pause in compliance with its Section 1071...

United StatesFinance and Banking
A.J. Dhaliwal
A.J. Dhaliwal
Sherwin Root
Sherwin Root
Maxwell Earp-Thomas
Maxwell Earp-Thomas
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This week, the CFPB filed an emergency notice in the Fifth Circuit Court of Appeals, indicating that it no longer opposes a pause in compliance with its Section 1071 small business data-collection rule (previously discussed here, here, and here). This marks a significant departure from its previous stance as it navigates ongoing legal challenges from lenders.

The notification was submitted just before a scheduled hearing in the case challenging the rule's validity, and states "Counsel for the CFPB has been instructed not to make any appearances in litigation except to seek a pause in proceedings." This shift raises questions about the rule's near-term enforceability, particularly for financial institutions that have been preparing for its implementation.

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