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TITLE X OF DODD-FRANK ADDRESSES MORE THAN JUST PREEMPTION

Our previous Alerts on the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203 (July 21, 2010) have focused largely on the new preemption standards in Title X, known as the Consumer Financial Protection Act of 2010. See Alerts dated July 16, August 31 and September 15, 2010. Although the new preemption provisions may have stolen the spotlight, Title X makes other changes that will affect financial institutions. A few of these other changes are highlighted below.

Substantive Changes in the "Conforming Amendments" Subtitle
Among the technical and administrative amendments in Subtitle H of Title X (Conforming Amendments) are the following substantive changes:

  • Alternative Mortgage Transaction Parity Act: Section 1083 reduces the scope of federal preemption for alternative mortgage transactions.
  • Home Mortgage Disclosure Act: Section 1094 adds a significant number of new data collection and reporting requirements for mortgage lenders.
  • Truth in Lending Act (TILA): Section 1100E increases the dollar amount threshold for TILA coverage from $25,000 to $50,000. See also Section 1416 (in Title XIV), which amends the TILA to increase the maximum dollar amount for penalties in a class action from $500,000 to $1M.
  • Fair Credit Reporting Act: Section 1100F requires provision of credit scores with adverse action and risk-based pricing notices.

Substantive Changes in the "Regulatory Improvements" Subtitle
Subtitle G of Title X (Regulatory Improvements) includes the following substantive changes:

  • Small Business Data Collection: Section 1071 amends the Equal Credit Opportunity Act to require financial institutions accepting business loan applications to (i) inquire whether the business is a women-owned, minority-owned or small business and (ii) maintain itemized records of the responses to such inquiry. The data must be kept for three years, made available to the public upon request and submitted annually to the Consumer Financial Protection Bureau.
  • Remittance Transfers: Section 1073 expands the coverage of the Electronic Fund Transfer Act (EFTA) to include remittance transfers.
  • Reasonable Fees and Rules for Payment Card Transactions: Section 1075 amends the EFTA to authorize the Federal Reserve Board to regulate interchange transaction fees for electronic debit transactions.
  • Judy Scheiderer