The Consumer Financial Protection Bureau issued a policy statement that explains the legal prohibition on abusive conduct in consumer financial markets and summarizes precedent.
Impact: The guidance is designed to provide a framework to help federal and state enforcers identify when companies engage in abusive conduct and to help firms avoid committing abusive acts or practices.
Details: In the policy statement, the CFPB sets forth how abusive conduct generally obscures important product features or uses certain circumstances, such as gaps in understanding and unequal bargaining power, to take unreasonable advantage of consumers. It also describes how the use of dark patterns, set-up-to-fail business models, profiteering off captive customers, and kickbacks and self-dealing can be abusive.
Comment Deadline: Public comments on the policy statement are due by July 3.
