WASHINGTON — The Consumer Financial Protection Bureau issued a bulletin Tuesday warning financial institutions about entering into agreements with third parties that share or hide information related to regulatory exams.
The reminder comes at a time when the CFPB said it's "aware that some" institutions might have non-disclosure agreements with another party that either restrict it from giving information to a regulator or require that it to notify the third party when it's about to do so. The CFPB explicitly noted that the advisory was not just for regulated banks but for non-banks "that may be unfamiliar with federal supervision" and existing requirements on confidential supervisory information.
The bulletin is meant to detail what constitutes as "confidential supervisory information" and limitations on sharing such information with third parties. Confidential supervisory information largely includes reports from regulatory exams and any related interactions, whether it's with the CFPB, state, federal or foreign government agency, the bulletin said. Such documents have significant restrictions on the supervised institution in sharing it with a third party, unless it is an affiliate, consultant or person who's duties are related to the supervisory action such as a board of directors.
The CFPB also gave a warning against supervised institutions in using non-disclosure agreements as a means to limit the agency's ability to obtain information.
"The bulletin explains that provisions in non-disclosure agreements do not alter or limit the bureau's existing supervisory authority or the supervised financial institution's obligations relating to confidential supervisory information," the agency said.
The CFPB supervises banks and credit unions with at least $10 billion in assets. It also exams certain nonbanks in the mortgage and student loan space as well as payday lenders, large debt collectors and consumer reporting agencies.