The CFPB's 'UDAAPification' of Consumer Protection Law
Law360Jonice Gray Tucker, Aaron C. Mahler
Questions about the scope of the Consumer Financial Protection Bureau's jurisdiction abound for financial institutions and other entities that work with them. What are the boundaries of the CFPB’s authority? How might these parameters expand in the future? Are there other ways the CFPB may take action against a company even if it does not have supervisory authority, and what would that action look like? These are just a few of many jurisdictional questions that financial institutions and their kin have pondered since the CFPB opened its doors in July 2011.
The CFPB’s jurisdiction is wide and its reach seems to grow longer as time passes. The bureau regulates many entities through direct supervisory authority and holds the power to indirectly “regulate” many others through its ability to enforce a veritable alphabet soup of consumer protection laws. These laws include Sections 1031 and 1036 of the Consumer Financial Protection Act, a far-reaching statute that broadly prohibits unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for consumer financial products and services or the offering of such products or services.
Originally published by Law360; reprinted with permission.