CFPB urges N.Y. legislature to enact UDAAP prohibitions

Even as House Republicans try to restrict the Consumer Financial Protection Bureau’s power to initiate enforcement actions based on “Unfair, Deceptive or Abusive Acts or Practices (UDAAP),” CFPB officials are urging the New York State Legislature to pass legislation giving state agencies those enforcement powers.

“The creation of the federal prohibition on abusive conduct was a significant milestone in the history of consumer protection,” Brian Shearer, the CFPB’s assistant director for the Office of Policy Planning and Strategy,” wrote in a letter to New York Gov. Kathy Hochul and state legislative leaders. Shearer noted that the CFPB was created and was given those enforcement powers in the wake of the 2008 financial crisis.

Consumer protection legislation has been introduced in both houses of the New York legislature and has been referred to committees for their consideration.

In legislative findings attached to the bill, supporters said that state law only protects consumers against deceptive acts, adding that other states have more expansive consumer protection statutes. “The State must not allow bad actors to peddle predatory products and services as long as they are clever enough not to get caught in a lie,” the findings state.

 

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