The Consumer Financial Protection Bureau (CFPB) is establishing supervisory authority over installment lender World Acceptance Corp.
CFPB is charged with supervising a wide range of financial firms to ensure they are complying with federal consumer financial protection laws. Among them, the CFPB has supervised nonbank entities in certain industries like mortgage and payday lending, service providers to banks and credit unions, and larger players in particular markets.
Regarding World Acceptance, the CFPB assessed its supervision program in 2022 and learned that the agency was failing to conduct oversight using a specific legal authority to supervise entities posing risks to consumers. Thus, the CFPB began to utilize this dormant authority and issued procedures to promote transparency about this tool.
The CFPB’s procedures require it to issue a notice to an entity not currently subject to a supervisory examination. The entity can either consent to supervision or contest the notice. Typically, the notices have pointed to consumer complaints and other indicators of risk to consumers.
Supervisory exams help companies identify and rectify potential violations of the law. Most entities receiving notices have decided to consent to supervision. These entities operate in a range of industries across consumer financial services.
In this case, the CFPB has determined that World Acceptance has met the legal requirements for supervision. The CFPB is making this order public to provide transparency about how it assesses risks using consumer complaints and other factors.
It should be noted that this order by the CFPB does not constitute a finding that the entity has engaged in wrongdoing.