Global: CFPB Gains Supervisory Authority Over World Acceptance

94F3F0BE 825D 4BDA AD8B EAAD034FF6D9
Share this article

The Consumer Financial Protection Bureau (CFPB) has taken decisive action to establish supervisory authority over installment lender World Acceptance Corp., aiming to ensure compliance with federal consumer financial protection laws.

In a press release issued on Friday (Feb. 23), the agency stated, “The CFPB has determined that World Acceptance Corporation has met the legal requirements for supervision.” Notably, the CFPB emphasized that this order does not imply any wrongdoing on the part of the entity.

World Acceptance Corp. has not yet responded to PYMNTS’ request for comment regarding the CFPB’s action.

According to its annual report released on June 1, the company acknowledged that the CFPB had begun using its “dormant authority” to examine nonbank entities when it believes the institution’s conduct poses risks to consumers.

“The CFPB has notified the company that it is seeking to establish such supervisory authority over the company,” stated World Acceptance in its annual report. “The company disagrees that the CFPB has reasonable cause to supervise the company, has responded to the CFPB’s notice, and is awaiting further response from the CFPB.”

The CFPB’s order concerning World Acceptance represents the regulator’s first supervisory designation order in a contested matter, as highlighted in the press release.

In its efforts to supervise various financial firms, the regulator has identified the necessity of utilizing specific legal authority to oversee entities posing risks to consumers.

Under the CFPB’s new procedures, entities not currently subject to supervision may receive a notice and choose to either consent to supervision or contest the notice. Typically, these notices point to consumer complaints and other risk indicators.

While most entities opt to consent, the supervisory exams remain confidential and are aimed at assisting companies in identifying and rectifying potential violations of the law.

  • In January, three members of Congress urged the CFPB to reopen and extend the public comment period on a proposed rule that would allow it to supervise large nonbank companies offering services like digital wallets and payment apps. They also encouraged the CFPB to reconsider finalizing the rule in its current form.
Share this article

Kenya Leads Global Interest in Worldcoin Despite Ban

Previous article

UNEA-6: Fossil Fuels Drive Both The Plastics And Climate Crises & Need An International Framework To Phase Them Out

Next article

You may also like


Comments are closed.

More in Regulatory