Over the past two years, the Consumer Financial Protection Bureau (CFPB) has been aggressively seeking to expand the range of companies over which it has examination authority. These efforts included the CFPB’s announcement in 2022 of its intention to use a previously “dormant” authority to conduct regulatory examinations of nonbank financial companies when they pose risks to consumers and a rule the CFPB proposed in November 2023 that seeks to modify existing guidelines by adding provisions that specifically target “larger participants” within the digital wallet and payment application spheres, subjecting these nonbank companies to comprehensive examinations.
As the CFPB seeks to sweep fintechs and other nonbank financial companies into its regulatory ambit, the procedural rights it provides to these newly regulated entities have come under increasing scrutiny. Among the most critical of these rights is the ability of regulated entities to appeal the CFPB’s adverse determinations within the CFPB itself. This appeals process is known as an “intra-agency appeal,” and it promotes the fair use of supervisory authority by enabling regulated entities to appeal decisions to an independent decision-maker within the agency.
