Credit card issuers market various “add-on” products to card users, including debt protection, identity theft protection, credit score tracking, and other products that are supplementary to the credit provided by the card itself. This bulletin outlines the Consumer Financial Protection Bureau’s (“CFPB” or “the Bureau”) expectation that institutions under its supervision and their service providers offer such products in compliance with Federal consumer financial law.
Unfair and Deceptive Acts and Practices (UDAP and UDAAP)
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), all covered persons or service providers are legally required to refrain from committing unfair, deceptive, or abusive acts or practices (collectively, UDAAPs) in violation of the Act. The Consumer Financial Protection Bureau (CFPB or Bureau) is issuing this bulletin to clarify the contours of that obligation in the context of collecting consumer debts.
The Consumer Financial Protection Bureau (CFPB or Bureau) is issuing this Bulletin to inform credit card issuers of the risk of engaging in deceptive and/or abusive acts and practices1 in connection with solicitations that offer a promotional annual percentage rate (APR) on a particular transaction over a defined period of time. These transactions include, but are not limited to, convenience checks, deferred interest/promotional interest rate purchases, and balance transfers.
The Bureau recognizes that many supervised entities may choose to implement incentive programs to achieve business objectives. When properly implemented and monitored, reasonable incentives can benefit consumers and the financial marketplace as a whole.
Reviews of products and services help to promote fair, transparent, and competitive markets. When firms frustrate the ability of consumers to post honest reviews of products and services that they use, they may be engaged in conduct prohibited by the Consumer Financial Protection Act (CFPA). The Consumer Financial Protection Bureau (Bureau) is issuing this bulletin to remind regulated entities of the CFPA’s requirements and explain how the Bureau intends to exercise its enforcement and supervisory authorities on this issue.
The Consumer Financial Protection Bureau (Bureau or CFPB) has issued Consumer Financial Protection Circular 2022–02, titled, ‘‘Deceptive representations Involving the FDIC’s Name or Logo or Deposit Insurance.’’ In this circular, the Bureau responds to the question, ‘‘When do representations involving the name or logo of the Federal Deposit Insurance Corporation (FDIC) or about deposit insurance constitute a deceptive act or practice in violation of the Consumer Financial Protection Act (CFPA)? ’’
The Consumer Financial Protection Bureau (Bureau or CFPB) has issued Consumer Financial Protection Circular 2022–04, titled, ‘‘Insufficient Data Protection or Security for Sensitive Consumer Information.’’ In this circular, the Bureau responds to the question, ‘‘Can entities violate the prohibition on unfair acts or practices in the Consumer Financial Protection Act (CFPA) when they have insufficient data protection or information security?’’
The Consumer Financial Protection Bureau (Bureau or CFPB) has issued Consumer Financial Protection Circular 2023–01, titled ‘‘Unlawful Negative Option Marketing Practices.’’ In this circular, the Bureau responds to the question, ‘‘Can persons that engage in negative option marketing practices violate the prohibition on unfair, deceptive, or abusive acts or practices in the Consumer Financial Protection Act (CFPA)? ’’
The Consumer Financial Protection Bureau (Bureau or CFPB) has issued Consumer Financial Protection Circular 2024–01, titled, ‘‘Preferencing and steering practices by digital intermediaries for consumer financial products or services.’’ In this circular, the Bureau responds to the question, ‘‘Can operators of digital comparison-shopping tools or lead generators violate the Consumer Financial Protection Act (CFPA) by preferencing products or services based on financial or other benefits to the operator?’’
The Consumer Financial Protection Bureau (CFPB) has issued Consumer Financial Protection Circular 2024–03, titled, ‘‘Unlawful and Unenforceable Contract Terms and Conditions.’’ In this circular, the CFPB responds to the question, ‘‘Can persons that include unlawful or unenforceable terms and conditions in contracts for consumer financial products and services violate the prohibition on deceptive acts or practices in the Consumer Financial Protection Act (CFPA)?’’