Regulatory Freeze Memorandum
On January 20, 2025, President Trump issued a 60-day regulatory freeze memorandum, pausing new and in-process regulations. The 1071 Rule is not subject to this freeze as it is technically in effect as of August 23, 2023, even though compliance is not mandatory.
Executive Order Impact
On January 20, 2025, President Trump issued an Executive Order, “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government.” This Order may impact 1071 and other rules. Key changes for 1071 could include:
- Removing the reference to “gender” in the 1071 sample data collection form
- Inserting selections for “male” or “female” instead of a free-form text field on the 1071 sample data collection form
- Deleting the requirement to ask whether a small business is LGBTQI+ owned
Status of 1071 Litigation
On February 4, 2025, the CFPB, under the new leadership of Treasury Secretary Scott Bessent, advised that it would no longer oppose the stay of the 1071 compliance deadlines while it reconsiders its stance on the rule. On February 7, 2025, the Fifth Circuit granted the motion for a stay pending appeal, meaning the CFPB cannot enforce the rule during the appeal. The court also extended the final rule compliance deadlines for members of the co-plaintiff trade associations, including all ABA members. Rep. Roger Williams (R. Tex.) introduced a bill to repeal 1071 on February 4, 2025.
Stay tuned for further updates as we navigate these developments. There is undoubtedly more to come.
Sarah Smith, CRCM, CAFP