UDAAP Dodd-Frank Consumer Protection
United States2010Consumer ProtectionOverview
Key Obligations
- Avoid unfair practices that cause substantial consumer harm not outweighed by benefits
- Refrain from deceptive practices that mislead consumers through representations or omissions
- Prevent abusive acts that take unreasonable advantage of consumer understanding or circumstances
- Provide clear and accurate disclosures for products, pricing, terms, and risks
- Monitor and remediate consumer complaints and conduct root cause analysis
- Maintain robust compliance programs and employee training to prevent violations
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Related Regulations
FAQ
What qualifies as a UDAAP violation?
Any financial activity that is unfair, deceptive, or abusive and harms consumers or misrepresents product features.
Who enforces UDAAP rules?
The Consumer Financial Protection Bureau (CFPB) primarily enforces UDAAP, along with other federal and state regulators.
How is UDAAP different from UDAP?
UDAP (Unfair or Deceptive Acts or Practices) was enforced under the FTC Act. UDAAP adds “abusive” as a separate category under Dodd-Frank.
Can non-bank companies be held liable under UDAAP?
Yes, fintechs, lenders, and even service providers to financial institutions are subject to UDAAP oversight.