Now that the Consumer Financial Protection Bureau is properly equipped with Richard Cordray as its director, news that it will monitor nonbank entities (independent lenders, brokers, servicers) in the same way it does banks is certainly good news for those wanted to see what an effective CFPB can do and how a robust bureau can establish “a new sheriff with real authority,” as John Taylor of the National Community Reinvestment Coalition wrote in Shelterforce in 2009.
In a blog post, Cordray emphasized the role nonbank entities play and that this extension of the CFPB's bank supervision program will help level the playing field for all industry participants to create a fairer marketplace for consumers and the responsible businesses that serve them
There are currently thousands of nonbank businesses that offer consumer financial products and services, and consumers interact with them all the time. If you've taken out a payday loan, received a call from a debt collector, or accessed your credit report, you may well have done business with one yourself. These common transactions add up to a big part of the overall market for consumer financial products and services, and the importance of nonbanks has grown substantially over the last few decades.
This is a pretty major development because the nonbank segment of the financial sector “played a huge role in the bad practices—from fee price gouging to sub-prime loan steering—that helped create the crisis in today's housing market,” said Dan Kildee of the Center for Community Progress in a statement.
Following his appointment, Cordray released a video outlining the general goals of the CFPB: