On July 23, several plaintiffs filed a complaint against the CFPB in the U.S. District Court for the District of Columbia alleging the CFPB and its acting director violated federal law by delaying implementation and enforcement of the requirements in Section 1071 of the Dodd-Frank Act. The complaint seeks declaratory and injunctive relief, specifically seeking a declaration that the CFPB violated the Administrative Procedure Act and Section 1071, and an order setting aside recent CFPB actions. The plaintiffs argued the CFPB has not complied with the Dodd-Frank Act’s mandate to collect and make publicly available data required by Section 1071 of the Act. The complaint noted the CFPB issued an interim final rule in June extending the rule’s compliance deadlines by another year without public notice or comment, allegedly violating the Administrative Procedure Act and the ECOA by unlawfully withholding and delaying agency action, amending regulations without proper procedure, and acting arbitrarily and capriciously (covered previously by InfoBytes here).

As previously covered by InfoBytes, Section 1071 would, if implemented, require financial institutions to disclose data collected from small business loan applicants, particularly from women- and minority-owned businesses. This data would be provided to the Bureau, which may then publish the data. Since being finalized by the CFPB, this rule has been stayed by several federal district courts (covered here and here). The CFPB recently filed a joint status report asking one of these courts to extend the stay (covered here).

The plaintiffs’ complaint further asserted that the CFPB’s actions to delay the rule would harm small businesses since it impedes those businesses and their advocates from accessing data needed to identify credit deserts and discriminatory lending practices. The plaintiffs claimed the dearth of data required to be made public under Section 1071 has made it “impossible” for organizations to address business and community development needs, allegedly harming fair lending and community development initiatives.

Accordingly, the plaintiffs asked the court to declare CFPB in violation of the Administrative Procedure Act and Section 1071, to vacate the agency’s non-enforcement policy and the 2025 interim final rule, and to order immediate compliance with the statutory data collection and publication requirements.

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