The Bureau of Consumer Financial Protection, or CFPB, has issued a bulletin, which the CFPB refers to as the Interim ILS Guidance, to address certain administrative issues relating to the Interstate Land Sales Full Disclosure Act, or ILS.
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, on July 21, 2011, all of the consumer protection functions of the Department of Housing and Urban Development, or HUD, relating to the ILS transferred to the CFPB, and the CFPB has all powers and duties that were vested in the Secretary of HUD relating to the ILS. The Dodd-Frank Act also amends the ILS to conform the transfer of these authorities to the CFPB. The CFPB is authorized to administer and enforce requirements under the ILS, subject to the limitations and other provisions of the Dodd-Frank Act.
Later this year, the CFPB intends to publish in chapter X of title 12 of the Code of Federal Regulations the rules, including HUD’s ILS rules, for which rulemaking authority transfers to the CFPB, including conforming amendments to reflect both the transfer of authority to the CFPB under the Dodd-Frank Act and certain other changes made by the Dodd Frank Act to the underlying statutes. In the interim, the existing rules will continue in effect and the changes made by the Dodd-Frank Act to transfer authority to the CFPB were effective as of July 21, 2011 by operation of law.
The CFPB has issued Interim ILS Guidance, effective July 21, 2011, for clarification and convenience pending the issuance of revised ILS regulations in order to facilitate compliance with and administration of the ILS, as amended. HUD’s regulations implementing ILS have provided, among other things, for entities subject to the ILS to provide certain documents and payments to HUD. The guidance clarifies that such materials should be submitted to the CFPB. An entity that acts in accordance with the guidance will be considered to be in compliance with the ILS and its implementing regulations and would not be subject to CFPB enforcement for lack of compliance with the regulations referring to HUD and its contact information.
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