On June 1, 2015, the Independent Community Bankers of America (“ICBA”) heavily criticized the CFPB’s decision to lodge information requests to data processing firms regarding checking account overdraft fees, particularly because of their alleged high costs and unwarranted breadth. The requests are targeted at information on community bank and credit union overdraft plans and seek approximately 60 data points, according to the ICBA, the leading lobbying group for small banks.

“ICBA strongly opposes this extreme example of government overreach under the guise of market monitoring authority and will be taking immediate and aggressive action to protect the interests of community banks and the privacy and integrity of their customers,” the ICBA stated in a notice released on Monday.

The ICBA’s reaction was precipitated by a notice sent by Fiserv, a major data processor, to its clients last week, which informed the banks and credit unions that it would be passing along the costs of complying with the CFPB’s data request.  A cost estimate will be delivered in August.

For years, the CFPB has been researching and compiling information regarding bank overdraft policies as part of its duties and obligations under the Dodd-Frank Act, resulting in studies released in 2013 and 2014.  Those studies, however, focused on larger banks and financial institutions more able to withstand the potential costs and resources necessary to respond to a CFPB inquiry.

The CFPB, in a recent statement, indicated that it had “tailor[ed] the information request [] to limit burden.” “The CFPB’s information requests are carefully considered and only request information relevant to our work to carry out our mission,” a CFPB spokesman said.  Given the ICBA’s recent objections, however, the CFPB’s requests may face a considerable challenge.

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Photo of H. Scott Kelly H. Scott Kelly

Scott is a consumer data and privacy specialist. He regularly defends against data breach lawsuits and class action claims asserted under federal and state consumer-protection statutes (FCRA, FDCPA, TCPA, UCC, UDAAP, RICO). Scott represents companies on an array of data privacy issues, including

Scott is a consumer data and privacy specialist. He regularly defends against data breach lawsuits and class action claims asserted under federal and state consumer-protection statutes (FCRA, FDCPA, TCPA, UCC, UDAAP, RICO). Scott represents companies on an array of data privacy issues, including background screening, consumer reporting, data breaches, ransomware attacks, and related regulatory investigations by the Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC), and state attorneys general.

Photo of Michael E. Lacy Michael E. Lacy

Michael heads the firm’s Consumer Financial Services practice, and handles class actions and high-stakes consumer litigation on a nationwide basis. He represents banks, mortgage servicers, debt buyers and collectors, and lenders against claims under consumer protection statutes, including the FCRA, TCPA, RESPA, RICO,

Michael heads the firm’s Consumer Financial Services practice, and handles class actions and high-stakes consumer litigation on a nationwide basis. He represents banks, mortgage servicers, debt buyers and collectors, and lenders against claims under consumer protection statutes, including the FCRA, TCPA, RESPA, RICO, and state UDAP laws. He has significant experience litigating and trying corporate governance disputes, including shareholder derivative claims, corporate dissolution cases, and corporate divorce matters. Michael also represents public utility companies in litigation and regulatory matters, including condemnation and land use cases.