CFPB Warns that Digital Marketing Providers Must Comply with Federal Consumer Finance Protections

  • Source:

Treliant Takeaway:

Treliant understands consumer protection and the complexities of today’s digital technologies.  If your financial services company needs assistance with evaluating your practices, including your use or provision of digital advertising, we can help.


On August 10, 2022, the Consumer Financial Protection Bureau (CFPB) issued an interpretive rule limiting the applicability of the Consumer Financial Protection Act’s (CFPA)  “Time or Space” exception with respect to digital marketing providers serving the financial services industry.

In the CFPA, one of the exceptions to the definition of “service provider” states that a person is not a service provider for the purposes of the CFPA solely by virtue of providing to a covered person time or space for an advertisement for a consumer financial product or service through print, newspaper, or electronic media. The interpretive rule addresses digital marketing providers that provide both targeting and delivery of advertising content.

Specifically, the CFPB notes that digital marketing providers that provide services beyond “time and space” for advertising are typically covered by the CFPA because such firms are materially engaged in development of targeting and content strategy. Such engagement goes beyond the “time and space” exception in the CFPA, which is intended to exempt marketers that limit their products and services to airtime or physical displays for advertising.

Under the interpretive rule, digital marketers providing services such as targeting, lead generation, customer acquisition, marketing analysis, or marketing strategy – including those that use advanced algorithms, complex analyses, and alternative data to target and customize advertising – may not qualify for the time and space exception to the CFPA.

When combined with the recent settlement between the U.S. Department of Housing and Urban Development, the Department of Justice and a large social media company, the strong regulatory and enforcement focus on digital marketing is clear. Digital marketing and their financial services clients must be aware of the risks associated with digital marketing. If your firm needs help assessing its risk in these areas, Treliant can help.