The Consumer Financial Protection Bureau (CFPB) issued guidance to address “abusive conduct” in consumer financial markets. The policy statement will “assist consumer financial protection enforcers in identifying wrongdoing, and will help firms avoid committing abusive acts or practices,” according to the CFPB.

“As a principle, we believe regulators should establish clear rules of the road and prioritize consistency in the application of those rules,” said Alexander Monterrubio, CUNA’s deputy chief advocacy officer for regulatory affairs. “Today’s policy statement is a small step toward clarifying the CFPB’s interpretation of ‘abusive’ but, without more practical guidance, credit unions will continue to be tasked with intuiting the real world contours of prohibited acts or practices through the Bureau’s enforcement actions. CUNA will continue to engage the Bureau on this issue.”

The statement refers to the title of the Dodd-Frank Act that states an abusive act or practice:

• Materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service; or
   
• Takes unreasonable advantage of:

• A lack of understanding on the part of the consumer of the material risks, costs, or conditions of the product or service;
• The inability of the consumer to protect the interests of the consumer in selecting or using a consumer financial product or service; or
• The reasonable reliance by the consumer on a covered person to act in the interests of the consumer.

Comments on the policy statement are due July 3.