House Financial Services Roundtable Highlights Priorities Behind Sweeping CFPB Reform Bill

Legislative Snapshot

• Bill: Consumer Financial Protection Accountability and Reform Act of 2026
• Jurisdiction: Federal
• Status: Introduced following release of a House Financial Services Committee discussion draft
• Key Provisions: CFPB appropriations and governance changes; UDAAP reforms; attorney litigation exemption; nonbank supervision changes; civil money penalty reforms; complaint database changes; requirements distinguishing guidance from enforceable law
• Effective Date: Varies by provision if enacted
• Industry Impact: Potentially significant changes to CFPB supervision, enforcement, debt collection litigation, consumer complaints and compliance expectations for ARM companies and other regulated financial services providers

House Financial Services Committee leaders used a Sept. 1 roundtable on the future of the Consumer Financial Protection Bureau to outline priorities that are also reflected in a newly introduced legislative package proposing substantial changes to the agency’s rulemaking, supervision and enforcement authority.

The discussion, titled “Modernizing Consumer Financial Protection: Reform, Accountability, and Opportunity,” included House Financial Services Committee Chairman French Hill, R-Ark.; Financial Institutions Subcommittee Chairman Andy Barr, R-Ky.; Consumer Bankers Association President and CEO Lindsey Johnson; and Financial Technology Association President and CEO Penny Lee. Former CFPB Director Kathy Kraninger delivered opening remarks.

The event coincided with committee Republicans’ unveiling of the Consumer Financial Protection Accountability and Reform Act of 2026, a five-title proposal intended to restructure several aspects of CFPB governance and authority. Committee leadership said the package is designed to increase accountability, establish clearer regulatory standards and create a more predictable approach to federal oversight.

For accounts receivable management companies and other CFPB-regulated businesses, several provisions would directly affect supervision, enforcement, complaints and debt collection litigation if enacted.

Roundtable Focuses on Regulatory Certainty

Participants discussed changes in regulatory interpretation between presidential administrations, the legal status of agency guidance, coordination between state and federal regulators and the use of cost-benefit analysis in rulemaking.

The discussion also addressed incentives for companies that identify compliance problems themselves and take steps to remediate consumer harm.

Those subjects closely track provisions included in the legislation. The House Financial Services Committee said the package seeks to address what Republican committee leaders characterize as shifting regulatory priorities, unclear legal standards, and duplicative supervision.

The committee previously released a discussion draft and sought public feedback on potential CFPB reforms, including questions about supervisory thresholds, enforcement policy, voluntary compliance, self-reporting and the consumer complaint process.

Bill Would Reshape UDAAP Enforcement

One of the most consequential sections for regulated financial services companies concerns the CFPB’s authority over unfair, deceptive, or abusive acts or practices.

The legislation would require the CFPB to issue a rule defining an “abusive act or practice” within 180 days of enactment. Until that rule became effective, the CFPB would be prohibited from beginning an enforcement action, administrative proceeding, or supervisory action based on allegations that conduct is abusive.

The bill would also establish a good-faith compliance provision affecting monetary relief and create a notice-and-cure process when a covered person self-identifies a potential UDAAP violation.

Under that process, the CFPB generally would have to provide written notice within 90 days of the self-identification and give the company 180 days to cure the potential violation before beginning an administrative proceeding or civil action.

The proposal would further define “substantial injury” as concrete and quantifiable harm and establish additional limitations governing how the CFPB uses UDAAP authority.

Debt Collection Litigation Provision Could Have Major ARM Impact

The bill contains a provision specifically affecting attorneys and law firms engaged in debt collection litigation.

It would generally remove federal agency supervisory, enforcement, and regulatory authority over defined “litigation activities” performed by licensed attorneys or law firms. The legislation would also amend the Fair Debt Collection Practices Act’s definition of “debt collector” to exclude licensed attorneys and law firms to the extent they are engaged in those litigation activities on behalf of clients.

The definition would encompass activities such as filing pleadings, participating in discovery, communicating in court proceedings, enforcing judgments, and certain other activities performed as part of the practice of law in connection with litigation.

If enacted in its current form, the provision could significantly change the federal regulatory framework governing collection law firms while leaving other collection activities outside the defined litigation exemption subject to applicable law.

Complaint Process Would Change

The CFPB’s Consumer Complaint Database would also face significant changes.

Consumers submitting complaints would generally have to attest under penalty of perjury that the information is accurate, that the complaint is being submitted by the consumer or an authorized representative, and that the consumer directly informed the company of the issue at least 60 days before filing the CFPB complaint.

Covered companies could close certain complaints without further action if they reasonably determine the complaint is duplicative, frivolous, unauthorized, fraudulent or misleading. Companies could also close complaints when the consumer had not first raised the issue at least 60 days earlier or when the company had already remedied the issue.

Consumer and company narratives would no longer be publicly viewable under the proposal, although the CFPB could continue publishing aggregated complaint data and trend analyses that do not identify individual consumers or covered companies.

Supervision, Penalties and Guidance Also Targeted

The proposal would narrow aspects of CFPB nonbank supervision by tying supervisory authority more closely to risks of “substantial injury to consumers.” It would also limit examinations and information requests to matters directly related to the applicable consumer financial product or service for which the company falls within CFPB supervisory jurisdiction.

Civil money penalties would be restructured, and self-reporting would become an explicit factor in determining penalties. The CFPB would also be directed to establish procedures for reducing penalties based on statutory mitigation factors.

Separately, federal financial regulators would have to place a statement on future guidance explaining that guidance does not have the force and effect of law and that failure to follow guidance does not conclusively establish a legal violation.

The legislation would also bring the CFPB into the regular congressional appropriations process, create a dedicated CFPB inspector general and establish expanded cost-benefit analysis and retrospective review requirements.

Legislative Debate Is Just Beginning

The proposal reflects priorities that Republican committee leaders have been developing through hearings, public feedback and discussion drafts throughout the summer. In July, the committee solicited comments specifically addressing how Congress could make CFPB supervision more predictable, encourage voluntary compliance and improve the complaint process.

The Sept. 1 roundtable offered another indication of the principles likely to guide the debate, particularly regulatory certainty, clearer distinctions between guidance and enforceable law, coordination among regulators and incentives for companies to identify and remediate compliance problems.

The legislation remains subject to the congressional process, meaning individual provisions could be amended, removed or added before any final legislation reaches the president.

For ARM companies, however, the package is worth watching closely. Its provisions involving debt collection litigation, UDAAP authority, nonbank supervision, complaints, and civil penalties would produce material changes to several areas of CFPB oversight if enacted.