Regulation G (SEC and CFPB)

Updated 2026-05-17

Regulation G refers to two distinct federal regulations in the U.S. financial regulatory framework, each serving different purposes:

1. 12 CFR Part 1007 (CFPB Regulation G): Implemented by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) (CFPB) to carry out provisions of the Nationwide Mortgage Licensing System Registry (NMLS), focusing on the federal registration of Mortgage Loan Originator (MLO)s (MLOs).
2. SEC Regulation G: Issued by the Securities and Exchange Commission (SEC) (SEC), this regulation governs the use of Non Gaap Financial Measures by public companies.

1. 12 CFR Part 1007 (CFPB Regulation G)

This version of Regulation G, codified as 12 CFR Part 1007, establishes requirements for the federal registration of MLOs. It outlines the general purpose and scope of MLO licensing, documentation for public record, and the regulatory powers of state mortgage agencies.

It specifically applies to MLOs who are employed by federally chartered or insured institutions, including insured depository institutions, their subsidiaries, or institutions regulated by the Farm Credit Administration (e.g., credit unions regulated by the National Credit Union Administration (NCUA)). These MLOs are considered "federally registered" and are not subject to state licensing requirements, distinguishing them from state-licensed MLOs. Regulation G outlines the procedures for these MLOs to register with the Nationwide Mortgage Licensing System Registry (NMLS) and maintain their registration, promoting accountability and consumer protection in the mortgage industry.

Key Requirements for Federally Registered MLOs

• NMLS Registration: Federally regulated MLOs must register with the Nationwide Mortgage Licensing System Registry (NMLS) Federal Registry.
• Unique Identifier: Each registered MLO receives a unique identification number through the NMLS, which must be provided to consumers in specific instances and included in advertisements. This is a critical component of transparency and consumer protection in the mortgage industry.
• Background Checks: MLOs must submit to a criminal background check as part of the registration process.
• Information Updates: MLOs are required to keep their registration information current within the NMLS.
• Public Availability: Information about registered MLOs is made publicly available through the NMLS Consumer Access website.
• Security Controls: MLOs must adhere to security controls for accessing NMLS accounts.
• Prohibitions: System administrators are generally prohibited from acting as MLOs, with some exceptions for smaller institutions.

Employer Responsibilities

Employers of federally-registered MLOs are mandated to adopt and maintain specific policies and procedures to ensure compliance with the SAFE Act and Regulation G:

• Written Policies and Procedures: Employers must establish written policies and procedures to ensure their MLOs comply with the SAFE Act and Regulation G.
• Annual Independent Testing: These written policies and procedures must be subjected to annual independent testing to verify their effectiveness and compliance.

Distinction from State-Licensed MLOs

Regulation G distinguishes between federally registered MLOs and state-licensed MLOs. Federally registered MLOs are exempt from state licensing requirements due to their employment by federally regulated institutions. This distinction is a critical component of the SAFE Act's goal to enhance consumer protection and reduce fraud in the mortgage industry.

Compliance with Regulation G is essential for all MLOs and their employers to ensure adherence to federal licensing and registration standards.

2. SEC Regulation G

This version of Regulation G is a federal regulation issued by the Securities and Exchange Commission (SEC) (SEC) that governs the use of Non Gaap Financial Measures by public companies. Its primary purpose is to ensure transparency and prevent misleading financial reporting when companies disclose financial metrics not prepared in accordance with Generally Accepted Accounting Principles (GAAP).

Key Provisions

• Reconciliation Requirement: Regulation G generally requires public companies to present the most directly comparable GAAP financial measure and a reconciliation to that GAAP measure whenever they publicly disclose a non-GAAP financial measure. This ensures investors can understand the differences between the non-GAAP metric and its GAAP equivalent.
• Prohibition on Misleading Information: The regulation explicitly prohibits the presentation of non-GAAP financial measures in a misleading way.
• Applicability: Regulation G applies to companies with securities registered under Section 12 of the Securities Exchange Act of 1934 or those required to file reports under Section 15(d) of the Act.
• Exemptions: Certain disclosures, such as non-GAAP financial measures included in communications related to proposed business combinations subject to proxy rules, may be exempt from some of Regulation G's requirements.

While not directly related to mortgage origination, SEC Regulation G is part of the broader federal regulatory landscape that MLOs might encounter when dealing with public company borrowers or understanding financial statements.