Read Bulletin 2022-05 Here
- Source: consumerfinance.gov
Treliant knows fairness and consumer protection. If your financial services company needs assistance with evaluating your practices for UDAAP risks, we can help.
On March 22, 2022, the Consumer Financial Protection Bureau (CFPB) issued Bulletin 2022-05: Unfair and Deceptive Acts or Practices That Impede Consumer Reviews. In the bulletin, the CFPB noted, “Reviews of products and services help to promote fair, transparent, and competitive markets. When firms frustrate the ability of consumers to post honest reviews of products and services that they use, they may be engaged in conduct prohibited by the Consumer Financial Protection Act (CFPA).”
In the bulletin, the CFPB addresses the relationship between the Consumer Review Fairness Act (CRFA), and notes several ways that violations of the CRFA by financial services providers could be Unfair, Deceptive, or Abusive Acts and Practices (UDAAPs). Financial services providers could engage in UDAAPs if they:
- Deceive consumers who wish to leave consumer reviews, or pressure a consumer to remove a negative review, by using unenforceable purported contractual restrictions;
- Unfairly deprive consumers of information by inappropriately restricting others’ consumer reviews; or
- Deceive consumers about the nature of available consumer reviews by having employees write consumer reviews; paying nonemployees to post misleading reviews; or manipulating reviews or review postings to inflate available consumer ratings.
The CFPB’s policy statement on consumer reviews echoes the Federal Trade Commission (FTC) Notice of Penalty Offenses related to endorsements, testimonials, and online and social media reviews. The FTC announced in October 2021 that it had delivered such notices to more than 700 companies. In a companion blog, the FTC stated that the notice covered use of influencers, fake reviews, and reviews by customers with connections to the company.
Taken together, the CFPB bulletin and the FTC notices indicate a renewed focus on fairness in advertising and marketing activities. Financial services providers should review their practices with respect to reviews, social media influencers, and endorsements in light of this guidance.
 15 U.S.C. 45b