Statement of TBA President & CEO on CFPB’s reissuance of the Section 1071 Final Rule

• TBA touts major victory for banking regulatory reform & community banks
• Section 1071 has been the “poster child for gross government over-reach”

“The reissuance of Section 1071 is a major victory for banking regulatory reform and a pivotal win for community banks. As the original plaintiffs against CFPB on 1071, the Texas Bankers Association and Rio Bank are very pleased to see the current leadership take substantive action to reissue and replace the deeply flawed 2023 Final Rule.

The Biden-Chopra Section 1071 rule has been the poster child for gross government over-reach. It would have forced small businesses and community banks to comply with 888 pages of regulation and collect 81 data points, including highly personal customer information. Even a politically divided Congress in 2024 agreed that the CFPB went too far and passed legislation to eliminate 1071 altogether, but Joe Biden vetoed it.

Until Congress can completely repeal Sec. 1071, we thank Acting Director Vought and the Administration for taking this common-sense step.

Our co-plaintiff, the American Bankers Association, estimates that our lawsuit challenging the Biden-Chopra Section 1071 Final Rule has saved financial institutions over $6.87 Billion in regulatory implementation costs and has prevented the potential exposure of sensitive data on small business customers.”

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Background: The Texas Bankers Association (TBA) is the nation’s oldest and largest state-based banking trade association. Along with Rio Bank, a community bank and minority depository institution based in McAllen, Texas, TBA filed suit against the Consumer Financial Protection Bureau in April 2023 challenging the Sec. 1071 Final Rule. In May 2023, the American Bankers Association joined as a co-plaintiff. Several other trade groups later intervened in opposition to the rule as well. As the organization has continued to pursue its Texas Bankers Association, et al vs CPFB lawsuit (now in the Fifth Circuit Court of Appeals), TBA has urged the Trump Administration to rescind and reissue the Biden-era rule.