Estimated reading time: 2 minutes
By: Ken Chase
The U.S. Consumer Financial Protection Bureau has created a new repeat offender unit that will reportedly focus on large banks that repeatedly violate federal laws and regulations. The regulatory body revealed the existence of the unit in a recent supervisory highlights report, noting that the ROU will work to identify recurring offenses and address root causes for those violations.
According to the report, “The Repeat Offender Unit will focus on ways to enhance the detection of repeat offenses, develop a process for rapid review and response designed to address the root cause of violations, and recommend corrective actions designed to stop recidivist behavior. This will include closer scrutiny of corporate compliance with orders to ensure that requirements are being met and any issues are addressed in a timely manner. “
CFPB Director Rohit Chopra has previously signaled that regulators would be looking to increase scrutiny of corporate repeat offenders. In March of 2021, Chopra suggested that the CFPB would pursue a wide range of penalties to address recidivism, including partnering with agencies at the state level to potentially revoke business licenses. Other possible actions ranged from forcing companies to divest from certain business activities to banning problematic business practices.
Chopra, a former Democrat member of the FTC has previously criticized enforcement methods like deferred prosecution agreements. Since taking the reins at CFPB, he has announced reviews of credit card company practices, and taken an aggressive stance against corporate board policies that shield their executives.