In the CFPB’s second attempt to define “abusive” acts or practices, the first being guidance rescinded a year after it was given in 2020, the CFPB has issued a new policy statement in which it turns to statutory analysis and past enforcement actions to provide a framework for determining what constitutes abusive conduct. … Continue Reading
CFPB issues circular on negative option marketing
The CFPB has issued a new circular (2023-01) that addresses the circumstances under which “negative option marketing practices” can violate the CFPA prohibition of unfair, deceptive, or abusive acts or practices.
The circular uses the term “negative option” to refer to “a term or condition under which a seller may interpret a consumer’s silence, failure to take an affirmative action to reject a product or service, or failure to cancel an agreement as acceptance or continued acceptance of the offer.” … Continue Reading
CFPB moves to dismiss Chamber’s lawsuit challenging UDAAP update to exam manual and opposes Chamber’s motion for summary judgment
The CFPB has filed a motion to dismiss, or in the alternative for summary judgment in, the lawsuit filed by the U.S. Chamber of Commerce in September 2022 challenging the CFPB’s update to the Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) section of its examination manual to include discrimination. … Continue Reading
U.S. Chamber of Commerce and other trade groups file motion for summary judgment in lawsuit against CFPB challenging UDAAP update to exam manual
The U.S. Chamber of Commerce has filed a motion for summary judgment in its lawsuit filed in September 2022 against the CFPB challenging the CFPB’s recent update to the Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) section of its examination manual to include discrimination. The other plaintiffs in the lawsuit, which was filed in a Texas federal district court, are American Bankers Association, Consumer Bankers Association, Independent Bankers Association of Texas, Longview Chamber of Commerce, Texas Association of Business, and Texas Bankers Association.… Continue Reading
U.S. Chamber of Commerce and other trade groups file lawsuit against CFPB challenging UDAAP update to exam manual
The U.S. Chamber of Commerce, joined by six other trade groups, filed a lawsuit yesterday in a Texas federal district court against the CFPB challenging the CFPB’s recent update to the Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) section of its examination manual to include discrimination. The other plaintiffs are American Bankers Association, Consumer Bankers Association, Independent Bankers Association of Texas, Longview Chamber of Commerce, Texas Association of Business, and Texas Bankers Association. … Continue Reading
CFPB addresses application of CFPA to digital marketing providers in new interpretive rule
The CFPB has issued an interpretive rule that addresses when digital marketing providers are “service providers” subject to the Consumer Financial Protection Act, including the CFPA’s prohibition on unfair, deceptive, or abusive acts or practices.
The CFPB describes digital marketing providers as businesses that use data obtained from an array of sources to offer targeted advertising services. … Continue Reading
Unfairness and disparate effects: a reply to Professor Jeff Sovern
In a blog post published on July 30 on Consumer Law and Policy Blog, Professor Jeff Sovern discusses comments from CFPB officials that the Bureau will not use the disparate effects or impact test to determine if discrimination has occurred when using its UDAAP authority. In those comments, Director Rohit Chopra and Assistant Director Eric Halperin indicated that “unfair” for purposes of the CFPB’s UDAAP authority has its own test and that the Bureau will use that test rather than the disparate effects test when using its UDAAP authority to determine if a discriminatory practice is unfair.… Continue Reading
This week’s podcast episode: The U.S. Chamber of Commerce’s campaign against CFPB Director Chopra’s attempt “to radically reshape the American financial services sector”: A discussion with Bill Hulse, Vice President, U.S. Chamber of Commerce Center for Capital Markets Competitiveness
We first review the views expressed by Director Chopra and CFPB actions taken under his leadership that led the Chamber to launch its campaign. We then discuss the campaign’s specific components, which consist of digital ads, Freedom of Information Act requests, and letters to Director Chopra. Our discussion includes an in-depth look at the basis for the Chamber’s view that the CFPB has acted unlawfully in connection with changes to its UDAAP examination procedures, revisions to its rules for administrative proceedings, rule change to make public a decision establishing risk-based supervision of a company, and its interpretive rule on enforcement of federal consumer financial protection laws by state attorney generals. … Continue Reading
CFPB corrects the record on response to trade groups’ letter on UDAAP updates to exam manual
We recently blogged about the request made by four leading trade groups for the CFPB to rescind the recent updates to the UDAAP section of its Supervision and Examination Manual that instruct examiners to consider discrimination in connection with non-credit products and services as an unfair act or practice.
The trade groups made their request in a letter to Director Chopra, which was accompanied by a white paper setting forth the legal basis for their position.… Continue Reading
Trade groups take aim at CFPB’s expansion of UDAAP authority
Four leading trade groups are calling on the CFPB to rescind the recent updates to the UDAAP section of its Supervision and Examination Manual that instruct examiners to consider discrimination in connection with non-credit products and services as an unfair act or practice. The four groups are the American Bankers Association, the Consumer Bankers, the Independent Community Bankers of America, and the U.S.… Continue Reading