Overview
Title
To reform the civil investigative demand process of the Bureau of Consumer Financial Protection.
ELI5 AI
H.R. 1653 wants to change how a special government group checks if people or companies are following the rules about money. It says the group should be quicker to respond, keep some secrets, and let judges help if there's a problem.
Summary AI
H.R. 1653, also known as the “Civil Investigative Demand Reform Act of 2025,” aims to revise how the Bureau of Consumer Financial Protection issues civil investigative demands. The bill proposes changes such as limiting the demand period to within six years of a violation and allowing attorneys to question the scope of demands with quick responses required from the Bureau. It also emphasizes confidentiality for petition contents and broadens the grounds for setting aside demands. Furthermore, it ensures that any denial by the Bureau to modify or set aside a demand can be reviewed judicially.
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AnalysisAI
General Summary of the Bill
The proposed legislation, H.R. 1653, titled the "Civil Investigative Demand Reform Act of 2025," aims to amend the Consumer Financial Protection Act of 2010. This bill seeks to reform the process for civil investigative demands (CIDs) issued by the Bureau of Consumer Financial Protection (commonly known as the Consumer Financial Protection Bureau, or CFPB). Key aspects of the bill include imposing a six-year limit on demanding actions after a violation, defining specifics around the facts required in a demand, establishing protocols for attorneys consulting on these demands, emphasizing confidentiality for petitions, allowing for demands to be set aside on specific grounds, and introducing judicial review for denied petitions.
Summary of Significant Issues
One major issue is the six-year limitation for pursuing violations. This change raises questions about enforcement in cases where violations are discovered after this period has elapsed. Another concern revolves around the requirement for demands to specify particular facts; the potential for varied interpretations could lead to inconsistent enforcement. Additionally, making petitions confidential might obscure the Bureau's decision-making process, affecting public transparency. The specified grounds for setting aside demands might be complex for smaller entities to handle without legal resources. Moreover, the process for legal questions and responses could unintentionally delay investigations. While judicial review offers a necessary check, the absence of a detailed timeline might extend legal disputes.
Impact on the Public
For the general public, the bill could have mixed effects. On one hand, the introduction of a time limit for investigations may encourage more prompt discovery and resolution of consumer financial violations, potentially leading to more efficient regulation enforcement. On the other hand, if violations only come to light after the six-year window, there might be fewer avenues for recourse. Furthermore, the increased possibility for judicial review ensures oversight, perhaps fostering greater fairness in regulatory practices.
Impact on Specific Stakeholders
For the CFPB, this bill represents both an opportunity and a challenge. While the amendments may streamline and clarify the investigative process, they may also impose constraints, potentially limiting the Bureau's capacity to investigate long-standing or complex violations.
For consumers, the bill can bolster protections through more structured legal processes. Yet, issues of transparency and enforcement delays could counteract these benefits.
Businesses, particularly smaller ones, might face difficulties due to the complex legal language and requirements for responding to CIDs, potentially disadvantaging those without accessible legal counsel. Conversely, larger organizations might find the stipulations on confidentiality and judicial review favorable, as they offer additional avenues to contest demands.
Overall, the bill aims to refine and reform existing processes but balances these changes against potential challenges affecting various stakeholders in distinct ways.
Issues
The amendment to Section 1052(c)(1) does not clarify what happens if a violation is discovered after the 6-year period, leaving potential ambiguity which could impact the efficacy of enforcing the law and holding violators accountable.
The language in Section 1052(c)(2) about 'specific reference to particular facts' may be subject to varied interpretations, potentially leading to inconsistent enforcement and legal challenges regarding the demands made by the Bureau.
The amendment to Section 1052(d) implies confidentiality of petitions, which could reduce transparency in the Bureau’s decision-making process regarding demands and potentially diminish public trust in the Bureau.
The language in Section 1052(f)(3)(C) regarding grounds to set aside demands is complex and could be challenging for individuals or smaller entities to navigate without legal assistance, thus potentially disadvantaging smaller entities compared to larger ones with more resources.
The process for submitting and responding to questions about the demand in Section 1052(c)(13)(D) may lead to delays in enforcement actions, especially if extensions are easily granted, which could stall the Bureau’s investigative processes.
The provision for judicial review in Section 1052(f)(4) is a positive step for checks and balances, but the process and timeline for such reviews are not detailed, which could lead to unnecessary delays and extended legal disputes.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of this bill specifies that the official name for the legislation is the "Civil Investigative Demand Reform Act of 2025."
2. Civil Investigative Demands Read Opens in new tab
Summary AI
The section outlines various amendments to the Consumer Financial Protection Act regarding civil investigative demands. Key changes include limiting the timeframe for demands to 6 years after a violation, requiring demands to reference specific facts, and allowing attorneys to ask questions about the demand's scope, with the Bureau required to respond within specific timeframes. Additionally, it addresses confidentiality for petitions, introduces specific grounds to set aside demands, and permits judicial review if the Bureau denies a petition to modify or dismiss a demand.