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M R EP O RT | 33 FEATURE The bulletin was a splash of cold water for lenders who held out hope that the CFPB would not return to a regime of more aggressive audits and enforcement activity. Put the change into a fiscal perspective, Bloomberg noted that "The CFPB under Richard Cordray, an Obama appointee who led the agency from 2012 to 2017, returned more than $12 billion to harmed consumers through enforcement actions. Under former Director Kathy Kraninger, a Trump appointee, the CFPB recovered around $1.5 billion in consumer redress over her approximately two years at the helm." Another policy-focused change that lenders will have to grapple with is a renewed focus on fighting "ongoing racial inequity" within financial markets. That will likely mean fair lending en- forcements and exams, something lenders must be prepared for. Additionally, the CFPB has also made it clear that they will be closely watching for sexual orientation and gender-based discrimination, under the Equal Credit Opportunity Act and Regulation B. One evolution in this area is that in the interven- ing period between the Obama and Biden administrations, the Supreme Court handed down their decision in Bostock v. Clayton County, Georgia, prohibiting sex discrimination under Title VII of the Civil Rights Act of 1964. This will surely give the bureau more firepower to address any perceived violations; the CFPB also notes its intent to work with Congress to pass the Equality Act, which would "codify protections for consumers against sexual orientation and gender identity discrimination in all financial products and services." Lenders must ensure that everything from sales to origina- tion systems to servicing are all working to shore up any potential vulnerabilities. Other recent activity of note from the CFPB include a proposal to extend foreclosure moratoria (under the Fair Debt Collection Practices Act) through the end of the year, adding an additional 60 days to the status quo. The policy changes at the CFPB will be carried out by a staff that is being quickly ramped up under Uejio. In February, he initiated a concerted effort to hire more enforcement-focused attorneys. Additionally, Uejio has hired Diane Thompson as a senior advisor. Thompson, a former CFPB official in the Obama-Cordray years, has argued for a CFPB with a greater emphasis on fighting racial and economic inequality. In govern- ment, the phrase "personnel is policy" is a reflection of how the hiring practices and trends of any individual agency are a signal of what the implementation of policy will eventually look like. Keep an eye on further personnel moves at the CFPB as the new director takes office and continues to staff up. The Community Mortgage Lenders of America (CMLA) and other industry groups continue to argue that a path that both protects consumers and deals fairly with lenders would include a requirement that CFPB exams only be initiated upon referral by another regulator. Additionally, The CMLA has posited that a statutory exemption for responsible, small community- based lenders would help protect access to affordable credit and remove unnecessary burdens and cost from these smaller businesses that do not have the luxury of large compliance/QA teams. What Should Lender CEOs Be Doing Right Now? I n light of the above, it seems only prudent for lenders to do what they can do to beef up their compliance teams. Whether that means hiring, outsourcing, or investing in technology or other resources, you simply cannot afford to act like this is 2019 and hope for the best. Beyond spending dollars, lenders should be encouraging their compliance officers to take advantage of free and low-cost educational opportu- nities like webinars. Additionally, if your team is not closely monitoring key perfor- mance metrics and making real- time changes and adjustments, you risk not being prepared for a state or CFPB exam. You simply cannot wait for a quarterly or annual audit to assess performance—that must be an ongoing priority, no matter your company size. With the new administration in Washington, and aggressive state legislatures, governors, and regulators from California to New York, lenders need to be investing back into their industry by sup- porting the critical advocacy work of groups, both at the state and national level. This is particularly true for small to mid-sized lend- ers, who often don't have a team of lobbyists (or even a lobbying budget at all) to promote sound fi- nancial policy. Joining with other lenders to speak with one voice can have a powerful impact on the legislative process. In short, times are good for lenders right now, but change is coming, and preparation is key. Keep your teams up-to-date on the latest information, don't neglect compliance/QA, and be ready for a much more energetic CFPB and regulatory environ- ment. . MICHAEL JONES is the CFO for Thrive Mortgage, LLC, and the Chair of the Community Mortgage Lenders of America. After graduating from Baylor University with a B.A. in accounting and a Master's in taxation, Jones joined PwC in Dallas, TX, to advise private companies and high net worth individuals on their tax needs. Over the years, he has been active with both the state and national Mortgage Bankers Association and authored a mortgage novel, Reset, in 2016. In government, the phrase "personnel is policy" is a reflection of how the hiring practices and trends of any individual agency are a signal of what the implementation of policy will eventually look like. Keep an eye on further personnel moves at the CFPB as the new director takes office and continues to staff up.