news.cuna.org/articles/119193-cfpb-rescinds-january-2020-abusive-acts-or-practice-statement
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CFPB rescinds January 2020 ‘abusive’ acts or practice statement

March 11, 2021

The Consumer Financial Protection Bureau (CFPB) Thursday announced it is rescinding its January 24, 2020 policy statement, “Statement of Policy Regarding Prohibition on Abusive Acts or Practices.” Going forward, the CFPB intends to exercise its supervisory and enforcement authority consistent with the full scope of its statutory authority under the Dodd-Frank Act as established by Congress.

According to the CFPB, it made these changes to “better protect consumers and the marketplace from abusive acts or practices, and to enforce the law as Congress wrote it.”

Congress defined abusive acts or practices in section 1031(d) of the Dodd-Frank Act. The standard prohibits companies from:

  • Materially interfering with someone’s ability to understand a product or service;
  • Taking unreasonable advantage of someone’s lack of understanding;
  • Taking unreasonable advantage of someone who cannot protect themselves; and
  • Taking unreasonable advantage of someone who reasonably relies on a company to act in their interests.