Rules of Practice for Adjudication Proceedings; Rescission

CONSUMER FINANCIAL PROTECTION BUREAU <CFR>12 CFR Part 1081</CFR> <DEPDOC>[Docket No. CFPB-2025-0012]</DEPDOC> <RIN>RIN 3170-AB33</RIN> <SUBJECT>Rules of Practice for Adjudication Proceedings; Rescission</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Consumer Financial Protection Bureau. <HD SOURCE="HED">ACTION:</HD> Proposed rule; request for comment. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Consumer Financial Protection Bureau (Bureau) is proposing to rescind the amendments it adopted to the Rules of Practice for Adjudication Proceedings (Rules of Practice) on February 22, 2022, and March 29, 2023. </SUM> <DATES> <HD SOURCE="HED">DATES:</HD> Comments must be received on or before June 12, 2025. </DATES> <HD SOURCE="HED">ADDRESSES:</HD> You may submit responsive information and other comments, identified by Docket No. CFPB-2025-0012, by any of the following methods: • <E T="03">Federal eRulemaking Portal: https://www.regulations.gov</E> . Follow the instructions for submitting comments. A brief summary of this document will be available at <E T="03">https://www.regulations.gov/docket/CFPB-2025-0012</E> . • <E T="03">Email: 2025-NPRM-Adjudication-Proceedings@cfpb.gov</E> . Include Docket No. CFPB-2025-0012 in the subject line of the message. • <E T="03">Mail/Hand Delivery/Courier:</E> Comment Intake—Rules of Practice for Adjudication Proceedings, c/o Legal Division Docket Manager, Consumer Financial Protection Bureau, 1700 G Street NW, Washington, DC 20552. <E T="03">Instructions:</E> The Bureau encourages the early submission of comments. All submissions should include the agency name and docket number. Because paper mail is subject to delay, commenters are encouraged to submit comments electronically. In general, all comments received will be posted without change to <E T="03">https://www.regulations.gov</E> . All submissions, including attachments and other supporting materials, will become part of the public record and subject to public disclosure. Proprietary information or sensitive personal information, such as account numbers or Social Security numbers, or names of other individuals, should not be included. Submissions will not be edited to remove any identifying or contact information. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> George Karithanom, Regulatory Implementation and Guidance Program Analyst, Office of Regulations, at 202-435-7700. If you require this document in an alternative electronic format, please contact <E T="03">CFPB_Accessibility@cfpb.gov</E> . </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Discussion</HD> The Bureau hereby issues this notice of proposed rulemaking, which proposes to rescind the amendments to its Rules of Practice for Adjudication Proceedings that the Bureau adopted on February 22, 2022, at 87 FR 10028 and on March 29, 2023, at 88 FR 18382. These changes expanded parties' opportunities to conduct depositions in adjudication proceedings and made amendments concerning timing and deadlines, the content of answers, the scheduling conference, bifurcation of proceedings, the process for deciding dispositive motions, and requirements for issue exhaustion, as well as other technical changes. The Bureau proposes to repeal these amendments in full and seeks comment on that proposal. The Bureau has particular concerns about the provisions of the 2022 and 2023 amendments that transferred authority to decide dispositive motions from the hearing officer who is presiding over the proceeding (normally an administrative law judge) to the Director. A dispositive motion includes a motion to dismiss or a motion for summary disposition. Under the 2022 and 2023 amendments, a party must file a dispositive motion with the Director, and the Director has the option of either deciding the motion or referring it to the hearing officer. This approach is atypical in the Executive Branch, where the norm is for hearing officers to decide dispositive motions, and industry commenters criticized it for concentrating authority in the Director at the expense of the hearing officer. With respect to other changes made by the amendments, the Bureau's preliminary view subject to considering comments is that they were largely unnecessary. <HD SOURCE="HD1">II. Section 1022(b)(2) Analysis</HD> In developing this rule, the Bureau has considered the rule's benefits, costs, and impacts in accordance with section 1022(b)(2)(A) of the Consumer Financial Protection Act (CFPA). <SU>1</SU> <FTREF/> The Bureau discussed the hypothetical benefits and costs of a more- or less-cost-effective process for adjudication proceedings in the February 2022 rule. In practice, no administrative proceedings have been conducted under the Rules of Practice since the 2022 and 2023 amendments, and only two cases have been brought through the administrative adjudication process from start to finish since the process was established in 2012. As such, any benefits, costs, or impacts to consumers or covered persons are likely to be minimal. <FTNT> <SU>1</SU>  12 U.S.C. 5512(b)(2)(A). Whether section 1022(b)(2)(A) is applicable to this rule is unclear, but in order to inform the rulemaking more fully the Bureau performed the described analysis. </FTNT> <LSTSUB> <HD SOURCE="HED">List of Subjects in 12 CFR Part 1081</HD> Administrative practice and procedure, Banks, banking, Consumer protection, Credit unions, Law enforcement, National banks, Savings associations, Trade practices. </LSTSUB> <HD SOURCE="HD1">Authority and Issuance</HD> As discussed above, the Bureau proposes to revise 12 CFR part 1081 to read as follows: <HD SOURCE="HED">PART 1081—RULES OF PRACTICE FOR ADJUDICATION PROCEEDINGS</HD> <CONTENTS> <SUBPART> <HD SOURCE="HED">Subpart A—General Rules</HD> <SECHD>Sec.</SECHD> <SECTNO>1081.100</SECTNO> <SUBJECT>Scope of the rules of practice.</SUBJECT> <SECTNO>1081.101</SECTNO> <SUBJECT>Expedition and fairness of proceedings.</SUBJECT> <SECTNO>1081.102</SECTNO> <SUBJECT>Rules of construction.</SUBJECT> <SECTNO>1081.103</SECTNO> <SUBJECT>Definitions.</SUBJECT> <SECTNO>1081.104</SECTNO> <SUBJECT>Authority of the hearing officer.</SUBJECT> <SECTNO>1081.105</SECTNO> <SUBJECT>Assignment, substitution, performance, disqualification of hearing officer.</SUBJECT> <SECTNO>1081.106</SECTNO> <SUBJECT>Deadlines.</SUBJECT> <SECTNO>1081.107</SECTNO> <SUBJECT>Appearance and practice in adjudication proceedings.</SUBJECT> <SECTNO>1081.108</SECTNO> <SUBJECT>Good faith certification.</SUBJECT> <SECTNO>1081.109</SECTNO> <SUBJECT>Conflict of interest.</SUBJECT> <SECTNO>1081.110</SECTNO> <SUBJECT>Ex parte communication.</SUBJECT> <SECTNO>1081.111</SECTNO> <SUBJECT> Filing of papers. </SUBJECT> <SECTNO>1081.112</SECTNO> <SUBJECT>Formal requirements as to papers filed.</SUBJECT> <SECTNO>1081.113</SECTNO> <SUBJECT>Service of papers.</SUBJECT> <SECTNO>1081.114</SECTNO> <SUBJECT>Construction of time limits.</SUBJECT> <SECTNO>1081.115</SECTNO> <SUBJECT>Change of time limits.</SUBJECT> <SECTNO>1081.116</SECTNO> <SUBJECT>Witness fees and expenses.</SUBJECT> <SECTNO>1081.117</SECTNO> <SUBJECT>Bureau's right to conduct examination, collect information.</SUBJECT> <SECTNO>1081.118</SECTNO> <SUBJECT>Collateral attacks on adjudication proceedings.</SUBJECT> <SECTNO>1081.119</SECTNO> <SUBJECT>Confidential information; protective orders.</SUBJECT> <SECTNO>1081.120</SECTNO> <SUBJECT>Settlement.</SUBJECT> <SECTNO>1081.121</SECTNO> <SUBJECT>Cooperation with other agencies.</SUBJECT> </SUBPART> <SUBPART> <HD SOURCE="HED">Subpart B—Initiation of Proceedings and Prehearing Rules</HD> <SECTNO>1081.200</SECTNO> <SUBJECT>Commencement of proceeding and contents of notice of charges.</SUBJECT> <SECTNO>1081.201</SECTNO> <SUBJECT>Answer and disclosure statement and notification of financial interest.</SUBJECT> <SECTNO>1081.202</SECTNO> <SUBJECT>Amended pleadings.</SUBJECT> <SECTNO>1081.203</SECTNO> <SUBJECT>Scheduling conference.</SUBJECT> <SECTNO>1081.204</SECTNO> <SUBJECT>Consolidation and severance of actions.</SUBJECT> <SECTNO>1081.205</SECTNO> <SUBJECT>Non-dispositive motions.</SUBJECT> <SECTNO>1081.206</SECTNO> <SUBJECT>Availability of documents for inspection and copying.</SUBJECT> <SECTNO>1081.207</SECTNO> <SUBJECT>Production of witness statements.</SUBJECT> <SECTNO>1081.208</SECTNO> <SUBJECT>Subpoenas.</SUBJECT> <SECTNO>1081.209</SECTNO> <SUBJECT>Deposition of witness unavailable for hearing.</SUBJECT> <SECTNO>1081.210</SECTNO> <SUBJECT>Expert discovery.</SUBJECT> <SECTNO>1081.211</SECTNO> <SUBJECT>Interlocutory review.</SUBJECT> <SECTNO>1081.212</SECTNO> <SUBJECT>Dispositive motions.</SUBJECT> <SECTNO>1081.213</SECTNO> <SUBJECT>Partial summary disposition.</SUBJECT> <SECTNO>1081.214</SECTNO> <SUBJECT>Prehearing conferences.</SUBJECT> <SECTNO>1081.215</SECTNO> <SUBJECT>Prehearing submissions.</SUBJECT> <SECTNO>1081.216</SECTNO> <SUBJECT>Amicus participation.</SUBJECT> </SUBPART> <SUBPART> <HD SOURCE="HED">Subpart C—Hearings</HD> <SECTNO>1081.300</SECTNO> <SUBJECT>Public hearings.</SUBJECT> <SECTNO>1081.301</SECTNO> <SUBJECT>Failure to appear.</SUBJECT> <SECTNO>1081.302</SECTNO> <SUBJECT>Conduct of hearings.</SUBJECT> <SECTNO>1081.303</SECTNO> <SUBJECT>Evidence.</SUBJECT> <SECTNO>1081.304</SECTNO> <SUBJECT>Record of the hearing.</SUBJECT> <SECTNO>1081.305</SECTNO> <SUBJECT>Post-hearing filings.</SUBJECT> <SECTNO>1081.306</SECTNO> <SUBJECT>Record in proceedings before hearing officer; retention of documents; copies.</SUBJECT> </SUBPART> <SUBPART> <HD SOURCE="HED">Subpart D—Decision and Appeals</HD> <SECTNO>1081.400</SECTNO> <SUBJECT>Recommended decision of the hearing officer.</SUBJECT> <SECTNO>1081.401</SECTNO> <SUBJECT>Transmission of documents to Director; record index; certification.</SUBJEC ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 156k characters. 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