ABA Disputes CFPB’s Assertion of Authority to View Lenders’ Attorney-Client ‘Work Product’

As originally reported yesterday by Corporate Counsel, the American Bar Association is disputing the controversial Consumer Financial Protection Bureau’s assertion that it has the authority to view the internal communications between the entities it regulates and those entities’ attorneys.  

Earlier this week, the ABA sent a comment letter to the CFPB, “objecting to a proposed rule that gives the agency the right to demand that all banks and other supervised financial entities submit privileged information to the bureau during examinations,” according to Corporate Counsel. 

ABA president William Robinson III expresses in the letter “serious concerns” about the CFPB’s “unfounded assertion of [its] authority to compel production of privileged materials.” 

The letter goes on to state:

“The attorney-client privilege is a bedrock legal principle that enables individual and organizational clients to communicate with their lawyers in confidence and encourages clients to seek out and obtain guidance enabling them to conform their conduct to the law. The privilege also facilitates self-investigation into past conduct to identify shortcomings and remedy problems, to the benefit of society at large. The work product doctrine underpins our adversarial justice system and allows attorneys to prepare for litigation without fear that their work product and mental impressions will be revealed to adversaries, to the detriment of their clients. The ABA strongly supports the preservation of the attorney-client privilege and the work product doctrine and opposes governmental policies, practices and procedures that may have the effect of eroding these protections.2″

Robinson’s letter also urges the CFPB to withdraw its proposed rule and instead  work with Congress toward final passage of H.R. 4014 — passed in the House and pending in the Senate — “as the best means to address and resolve the problem of third-party privilege waiver.”

Whether or not the CFPB, which seems to fancy itself as omnipotent, heeds such sound advice remains to be seen.