of Bank Policy Research Institute and Kentucky Bankers Association On Tuesday (October 22nd), Consumer Financial Protection Bureau(CFPB) Final Rule on Data Sharing released on the same day.
Plaintiffs argue in their lawsuit that the rule jeopardizes the security and privacy of consumer financial data, they said in a news release Tuesday. press release.
in lawsuitthey said that with its rules, the CFPB is “deviating from its statutory obligations and injecting itself into a developing, well-functioning ecosystem that is thriving under private initiative.” .
“The rules Plaintiffs challenge seek to cut off that private development and replace it with a complex and expensive mandatory regulatory framework never approved by Congress,” the complaint states. “Worse still, the framework adopted by the agency is fundamentally insecure, and the primary consequence of its overreach will be to the detriment of the very consumers it is charged with protecting.”
The complaint alleges that CFPB rules require banks to provide customers' financial information to “authorized” third parties, and that the CFPB's rules require banks to provide customers' financial information to “authorized” third parties without increasing the level of security protection afforded to their deposits or data. It claims it is illegal because it increases security risks and outsources authority. Set compliance standards for third parties, impose timelines for data providers to comply with rules at a time when standards are unknown, and impose costs and risks on banks while charging fees for banks to collect them. Prohibits collection. It costs money.
“For all these reasons…this court… stop ~ The lawsuit alleges the department's unlawful efforts to force banks to dangerously disseminate customers' personal financial information and ignore regulations under the Administrative Procedures Act (APA).
The rules, announced by the CFPB on Tuesday, are intended to give consumers more control over their products. financial data And it has the ability to securely share it with third-party providers, PYMNTS reported Tuesday.
CFPB Director Rohit Chopra The agency said Tuesday that following the release of the final rule, the agency will “develop a roadmap for the next set of rules to advance open banking.”
of Defense Credit Union Council Raising concerns about the rule on Tuesday, the credit union said: share your data That could expose it to legal troubles related to third-party data handling, which would result in “increased operational and financial burdens.”
