Legislation to remedy many of the most punishing regulatory elements of the Dodd–Frank Act is pending in Congress, and debate over revamping Title X of the law, which created the Consumer Financial Protection Bureau (CFPB), is particularly contentious. Critics claim that the proposed reforms would expose Americans to ruinous financial scams without legal recourse. The facts, however, say otherwise. Without the CFPB, longstanding federal and state statutes would fully protect American consumers against unfair, deceptive, and fraudulent practices. Repealing the bureau’s onerous constraints would increase consumer access to more affordable financial products and services.
The CFPB was established in the wake of the 2008 financial crisis to “regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws." Before its creation, authority for some 50 rules and orders stemming from 22 consumer protection statutes was divided among seven agencies.
More than simply consolidating regulatory authority, the Dodd–Frank Act granted the new agency unparalleled rulemaking, supervisory, and enforcement powers over virtually every consumer financial product and service. In effect, the CFPB was designed to dictate the types of financial products and services available to consumers instead of allowing them to exercise choice. In the words of Oren Bar-Gill and then-Professor Elizabeth Warren, the academic architects of the CFPB, borrowers suffer “cognitive limitations,” and their “learning is imperfect.” Under this paternalist paradigm, regulatory intervention is necessary to protect consumers from themselves by limiting complex credit options and standardizing “qualified” loans.
Before the financial crisis, there was a need to modernize the federal consumer protection regime, but a lack of consumer protection was not a major factor in the 2008 financial crisis. Now, however, the CFPB’s structural flaws are restricting access to credit, eroding Americans’ financial independence, and posing due process and separation of powers concerns.
CFPB advocates claim that the agency is vital for protecting consumers against “vulture capitalism.” But if Congress reforms the CFPB or even eliminates it altogether, consumers will be just as protected against unfair, deceptive, and fraudulent practices as they are today. No matter the fiery rhetoric of bureau advocates, the fact is that there was no shortage of consumer protection before the Dodd–Frank Act.
In addition to the 22 federal statutes, consumers are protected under state laws and regulations, and local ordinances too numerous to count. For decades, this framework governed the offering of consumer credit, and outlawed deceptive and unfair practices in financial products and services. Even Senator Elizabeth Warren (D-MA), intellectual architect of the CFPB, has acknowledged that “credit transactions have been regulated by statute or common law since the founding of the Republic.” Simply put, there was no need for Congress to create a new federal agency—let alone one with unparalleled rulemaking, supervisory, and enforcement powers over virtually every consumer financial product and service.
As with much else in Dodd–Frank, Congress created the CFPB without a thorough understanding of the housing market collapse, the subsequent failure of major financial firms, or the resulting shock to the economy, but lawmakers and the Trump Administration can remedy these policy missteps by eliminating the bureau. They can also increase enforcement efficiency by consolidating the various consumer protection statutes within the Federal Trade Commission (FTC), which has decades of experience in protecting consumer welfare and market competition.
Traditional Consumer Protection and the CFPB
At the time of the 2008 financial crisis, numerous federal consumer protection laws overlay state regulations. Despite the redundancy, establishment of the CFPB was not intended to remedy regulatory inefficiency. Rather, it was calculated to depart from the principles that had governed consumer protection law for decades.
Not only did Dodd–Frank imbue the bureau with authority over existing consumer protection statutes, but it also radically redefined consumer protection. Deference to consumer autonomy, the guiding regulatory principle for decades, was abandoned in favor of a paternalist paradigm that regards consumers as fundamentally irrational and prone to act against their self-interest.
The CFPB’s structural flaws have been fully exposed, but far less attention has been paid to the adequacy of the many and varied consumer protection statutes that predate the bureau—and which would remain in full effect in its absence. While it may seem politically risky for Members of Congress to challenge the need for this consumer protection agency, they can act with confidence that their constituents would be well-protected—indeed, better off—without an unaccountable bureau whose primary mission is to restrict access to financial products and services.
Earliest Consumer Protection Law. At its most elemental, consumer protection equates to rules of trade, and such rules date to the very beginnings of commerce. Among the oldest of trade principles is “Caveat Emptor” (“Let the buyer beware”). The term is actually part of the longer statement: “Caveat emptor, quia ignorare non debuit quod jus alienum emit,” or “Let a purchaser beware, for he ought not to be ignorant of the nature of the property which he is buying from another party.” From this principle evolved a great body of common law, as well as enactment of modern disclosure requirements for virtually every financial product.
Yale University scholar Walton H. Hamilton has documented sanctions against vendors as far back as 1256. Hamilton notes that:
The foundations of the scheme of regulation were the assizes [English and Welsh courts that administered civil and criminal law] of bread and of beer. A host of persons have won such immortality as the dusty annals of justice accord by having it set against their names that they were in mercy because of poor loaves or insufficient gallons.
Consumer protection laws also were written as “responses to crises and emergencies that generate great public outrage”—be the offenses real or exaggerated. Among the most often cited is the 1906 publication of Upton Sinclair’s novel The Jungle, which prompted swift passage of the Meat Inspection Act, followed by a variety of other health and safety regulations. But as some scholars have pointed out, federal action was not always warranted. For example, economist Lawrence W. Reed, president of the Foundation for Economic Education, refers to Sinclair’s expose as “a triumph of myth over reality, of ulterior motives over good intentions.” In fact, hundreds of federal, state, and local food inspectors were already employed more than a decade before The Jungle was published.
The Progressive Era. Massive industrialization and waves of immigration contributed to enormous wealth creation at the turn of the 20th century, but living conditions in major cities also deteriorated, and factories were dangerous places. Thus was born the Progressive Era, during which reformers sought to remedy a variety of social ills.
In addition to the Upton Sinclair–inspired Meat Inspection Act, Congress in 1906 also passed the Pure Food and Drug Act to prevent “the manufacture, sale, or transportation of adulterated or misbranded or poisonous or deleterious foods, drugs, medicines, and liquors.” Trading on populist resentment toward wealthy industrialists, President Theodore Roosevelt aggressively “busted” a variety of corporations, thus earning the moniker “trust-buster.” He went on to establish the Department of Commerce and Labor in 1903, which featured the Bureau of Corporations—a precursor to the Federal Trade Commission.
The FTC was created in 1914 to protect consumers, investors, and businesses from anticompetitive practices. Although closely associated with antitrust enforcement, the FTC’s first case was one of consumer protection involving the labeling of thread by the manufacturer, Circle Cilk Company. Notwithstanding the company name, the agency determined that “Cilk” floss was actually cotton. The commission concluded that the company intended to “confuse, mislead, and deceive purchasers” and barred it from using “Cilk” for any product not made of silk.
The New Deal. The stock market crash of 1929 and the ensuing Great Depression prompted a slew of federal statutes to regulate banks and securities. Various federal agencies, including the Securities and Exchange Commission, Federal Housing Administration, Federal National Mortgage Association, and Home Owners’ Loan Corporation, expanded the federal government’s reach into financial markets. Individuals’ bank deposits also won protection under the Banking Act of 1933, often referred to as the Glass–Steagall Act, which created the Federal Deposit Insurance Corporation (FDIC).
The Securities Act of 1933, known as the “Truth in Securities Act,” required issuers of securities to disclose all material information that a reasonable shareholder would require in order to make up his or her mind about a potential investment. (Before enactment of this legislation, the sales of securities were governed primarily by state laws.) Research has shown, however, that firms were already disclosing information before these federal requirements and the first federal disclosure laws merely codified common practices.
The Modern Era. A new wave of consumer protection was unleashed in the early 1960s, beginning with President John F. Kennedy’s 1962 “Special Message to the Congress on Protecting the Consumer Interest.” In his address, Kennedy asserted four foundational consumer rights: the right to safety, the right to be informed, the right to choose, and the right to be heard.
Three years later, Ralph Nader published Unsafe at Any Speed, which exposed the design flaws of the Chevrolet Corvair (and its rear engine) and detailed automakers’ purported resistance to installing safety features. Attempts by General Motors to smear Nader only elevated his public profile, and the activism he inspired is credited with passage of legislation such as the Clean Water Act, Freedom of Information Act, Consumer Product Safety Act, Foreign Corrupt Practices Act, Whistleblower Protection Act, and National Traffic and Motor Vehicle Safety Act.
The advent of taxpayer-subsidized legal services for the poor vaulted consumer protection into the realm of social justice. As part of President Lyndon Johnson’s War on Poverty, Congress created the Office of Economic Opportunity (OEO). The OEO believed that “one of the best ways to cure some of the poor's problems was to provide them with lawyers,” so it created the Legal Services Program. According to Mark Budnitz, Professor of Law Emeritus at the Georgia State University College of Law, the Legal Services Program “created the opportunity for substantial numbers of lawyers across the country to launch a large number of consumer law reform efforts.”
In the late 1960s, Congress moved further into the longstanding province of states in regulating consumer transactions with passage of the Consumer Credit Protection Act (CCPA). Title I of the CCPA, the Truth in Lending Act (TILA), mandated disclosure of credit charges “clearly and conspicuously” as specified by the Federal Reserve System. As declared by Congress, the TILA’s purpose was to “assure a meaningful disclosure of credit terms” rather than dictate the conduct of lenders or the content of loan agreements. The TILA is still a major component of federal consumer protection law—one of many statutes passed since 1968.
The following list describes the major federal consumer financial protection statutes enacted in the 10 years following TILA:
- The Fair Credit Reporting Act of 1970, the primary purpose of which was to “require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer.”
- The Real Estate Settlement Procedures Act of 1974, which was intended to ensure that consumers “are provided with greater and more timely information on the nature and costs of the settlement process and are protected from unnecessarily high settlement charges.”
- The Equal Credit Opportunity Act of 1974, which prohibited discrimination against credit applicants on the basis of race, color, religion, national origin, sex, marital status, or age.
- The Privacy Act of 1974, which established a code of practices to govern the collection, maintenance, use, and dissemination of information about individuals that is maintained by federal agencies.
- The Fair Credit Billing Act of 1974, which amended the TILA “to protect the consumer against inaccurate and unfair credit billing and credit card practices.”
- The Home Mortgage Disclosure Act of 1975, a primary goal of which was to “provide the citizens and public officials of the United States with sufficient information to determine whether depository institutions are fulfilling their obligations to serve the housing needs of the communities and neighborhoods in which they are located.”
- The Fair Debt Collection Practices Act of 1977, the stated purpose of which was to “eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.”
- The Electronic Fund Transfer Act of 1978, which required transparency of service terms and accountability for errors in the provision of electronic fund transfers such as services through automated teller machines, point-of-sale terminals, telephone bill-payment plans, and remote banking programs.
As these statutes show, there was no lack of consumer protections before Dodd–Frank. Statutes were designed to equip consumers with the information necessary to act on their own preferences, given market conditions, and to punish fraud and other wrongdoing. The role of government, at least theoretically, was to facilitate choice and competition through disclosure—an approach reflecting the belief that free enterprise, albeit imperfect, yields greater benefits than are yielded by autocratic alternatives.
In the wake of the 2008 crisis, many activists and a large segment of the media improperly blamed the wave of mortgage defaults on deficiencies in consumer protection law, but rather than call for more stringent regulation of financial firms, they demanded government control over the types of credit available to consumers. That is, they insisted that “consumer protection” focus on protecting consumers from themselves. Ultimately, such authority was bestowed on the Consumer Financial Protection Bureau.
Radical Shift in Consumer Protection
For decades before the financial crisis, consumer protection laws prohibited “deceptive” and “unfair” practices, terms that were well-defined in law. Primary responsibility for enforcement resided with the FTC, with the exception of banks, which were overseen by federal banking regulators.
Reflecting the overly broad nature of the powers granted to the CFPB, Congress empowered the agency to supervise any nonbank firm that it views as posing a risk to consumers or engaging in “unfair, deceptive, or abusive” practices. Unlike “unfair” and “deceptive,” however, the term “abusive” had not been defined in law and thus granted the CFPB inordinate discretion. As outlined in Title X of Dodd–Frank, the bureau’s authority to craft rules and enforce against “abusive” practices is particularly vague:
The Bureau shall have no authority…to declare an act or practice abusive in connection with the provision of a consumer financial product or service, unless the act or practice—
1. Materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service; or
2. Takes unreasonable advantage of
a) a lack of understanding on the part of the consumer of the material risks, costs, or conditions of the product or service;
b) the inability of the consumer to protect its interests in selecting or using a consumer financial product or service; or
c) the reasonable reliance by the consumer on a covered person to act in the interests of the consumer.
The agency has issued neither guidance nor rules to define abusive practices, nor have officials shown much willingness to provide clarity—even when asked explicitly to do so by Congress. During a 2012 hearing of the House Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs, for example, when asked by lawmakers to define “abusive,” CFPB Director Richard Cordray said that:
[T]he term abusive in the statute is…a little bit of a puzzle because it is a new term…. We have been looking at it, trying to understand it, and we have determined that that is going to have to be a fact and circumstances issue; it is not something we are likely to be able to define in the abstract. Probably not useful to try to define a term like that in the abstract; we are going to have to see what kind of situations may arise….
Under this framework, financial firms must operate according to a vague legal standard to which they might never be able to adhere. Aside from the near impossibility of complying with such a fleeting standard for abusive acts or practices, there is no objective way to measure a consumer’s ability to understand terms and conditions of financial products and services. Moreover, forcing financial firms into such a role, where they are effectively required to verify consumers’ understanding of terms rather than merely disclosing relevant information, goes well beyond the long-established consumer protection framework. Perhaps worse, this change, based on a hostile view of free enterprise, comes dangerously close to absolving one party in a financial contract from any real responsibility.
Paternalistic Regulation Endangers Economic Freedom. The Obama Administration and congressional Democrats blamed the financial crisis on lenders who exploited consumers, but deliberately deceiving borrowers was already illegal under existing law. Therefore, regulatory advocates were left to declare that consumers could not understand that these mortgages were risky. According to the CFPB’s academic architects, Oren Bar-Gill and Elizabeth Warren, as noted, borrowers suffer “cognitive limitations,” and their “learning is imperfect.” This explanation of the financial crisis and this new view of consumer protection are fatally flawed for several reasons.
First, the flood of defaults and foreclosures, regardless of the portion in low-income and moderate-income neighborhoods does not prove that lenders singled out borrowers who could not understand mortgage terms. And whether or not borrowers understood the mortgage terms, not all of them would default on their loans.
Reckless lending did play a role in the 2008 financial crisis, but the reality is that millions of lenders and borrowers were responding rationally to incentives created by an array of deeply flawed government policies, including regulators’ failure to accurately predict financial risks, that were designed to increase the supply of credit.
In both design and function, the Consumer Financial Protection Bureau is an affront to the supremacy of free enterprise as the most beneficial economic system. It is a bureaucratic monument to the notion that businesses are predatory by nature and that consumers are inherently incapable of managing their own interests and, therefore, need the strong arm of government to protect them in all transactions. This concept is deeply flawed. Americans enjoyed the world’s highest standard of living long before Dodd–Frank precisely because free enterprise provides widespread benefits from mutually beneficial exchanges.
The Obama Administration and congressional Democrats blamed the 2008 financial crisis on a lack of consumer protection and thus justified creation of the CFPB—arguably the most powerful and unaccountable regulatory agency in existence. In reality, inadequate consumer protection was not a factor in the financial crisis, and Americans would be just as protected against unfair and deceptive fraudulent practices without the CFPB as they have been for decades. Simply put, there was no shortage of consumer protection before Dodd–Frank, and consumers are worse off as a result of the CFPB.
As with much else in Dodd–Frank, Congress created the CFPB without a thorough understanding of the housing market collapse, the subsequent failure of major financial firms and the resulting shock to the economy. Congress and the Trump Administration can reverse these policy missteps by eliminating the CFPB. They can also increase enforcement efficiency by consolidating the various federal consumer protection statutes within the Federal Trade Commission, which has a proven history of promoting consumer welfare and market competition.
—Diane Katz is Senior Research Fellow in Regulatory Policy and Norbert J. Michel, PhD, is Senior Research Fellow in Financial Regulations and Monetary Policy in the Thomas A. Roe Institute for Economic Policy Studies, of the Institute for Economic Freedom, at The Heritage Foundation.
Consumer Protection Statutes Transferred to the CFPB
The Federal Deposit Insurance Act of 1950 governs the FDIC. Dodd–Frank transferred limited consumer protection law enforcement authority from the FDIC to the CFPB.
The Truth in Lending Act (TILA) of 1968 was enacted to provide uniform consumer protection standards in credit markets and focused mainly on disclosure requirements for such items as finance charges and the annual percentage rate (APR). In enacting the TILA, Congress found that “economic stabilization would be enhanced and competition…would be strengthened by the informed use of credit,” which “results from an awareness of the cost thereof by consumers.” Thus, the purpose of the act was to “assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices.” The act has been amended numerous times and now requires extensive disclosures of calculation methods and explanation of cost-related information. In the absence of a federal requirement, financial firms would still have incentives to provide adequate disclosures to potential customers, and it is difficult to see how they could operate successfully without doing so.
The Fair Credit Reporting Act (FCRA) of 1970 was enacted to “require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information.” The FCRA was enacted out of concern that “[i]naccurate credit reports directly impair the efficiency of the banking system, and unfair credit reporting methods undermine the public confidence which is essential to the continued functioning of the banking system.”
The Real Estate Settlement Procedures Act (RESPA) of 1974 was passed largely to ensure that borrowers “are provided with greater and more timely information on the nature and costs of the settlement process and are protected from unnecessarily high settlement charges.” The reference to “unnecessarily high” charges stemmed from complaints that lenders advertised loans at a low rate of interest provided the borrower used a specified title insurance company; the title company would then charge an inflated price and kick back a portion of the fee to the lender. It is unclear how the borrower benefits from prohibiting such a practice if lenders simply can raise the interest rate they charge, and evidence suggests that the RESPA did not achieve its stated purpose of lowering lending rates. Furthermore, the amount of information that lenders are now required to disclose obfuscates rather than informs the typical borrower, and it is unclear whether federal regulation of title and closing costs is even desirable.
The Equal Credit Opportunity Act (ECOA) of 1974 was intended to promote adequate disclosure of information to and about credit consumers and also to shield protected classes of consumers from discrimination when applying for credit. The law has been used more broadly since it was enacted and is now part of the framework used to prove disparate impact by employing, among other things, a judicial doctrine known as an effects test. In this broader framework, regulators can “prohibit a creditor practice that is discriminatory in effect because it has a disproportionately negative impact on a prohibited basis, even though the creditor has no intent to discriminate and the practice appears neutral on its face.”
The Privacy Act of 1974 established a code of information practices to govern the collection, maintenance, use, and dissemination of information about individuals that is maintained in systems of records by federal agencies. Broadly, the act aimed to balance the government’s need to maintain information about individuals with the right of those individuals to be protected against unwarranted invasions of their privacy “stemming from federal agencies’ collection, maintenance, use, and disclosure of personal information about them.”
The Fair Credit Billing Act of 1974 amended the Truth in Lending Act of 1968 to “protect the consumer against inaccurate and unfair credit billing and credit card practices.” The Fair Credit Billing Act was part of a disclosure-focused framework, the purpose of which was “to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit.”
The Home Mortgage Disclosure Act (HMDA) of 1975 was enacted primarily to “provide the citizens and public officials of the United States with sufficient information to enable them to determine whether depository institutions are filling their obligations to serve the housing needs of the communities and neighborhoods in which they are located.” The HMDA required banks and savings and loan associations to make data about their overall geographic lending patterns publicly available with a broader goal of improving “the private investment environment.” Over time, the HMDA’s focus has changed, from whether banks were lending in the neighborhoods where their deposit customers lived to whether lenders (even nonbank lenders) were discriminating, and ultimately to whether certain groups were being targeted with unfavorable loan terms.
The Fair Debt Collection Practices Act of 1977 was enacted to “eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.” Congress found it necessary to pass this legislation because “[a]busive debt collection practices contribute to the number of personal bankruptcies, to marital instability, to the loss of jobs, and to invasions of individual privacy.” The statute explicitly noted that “[e]ven where abusive debt collection practices are purely intrastate in character, they nevertheless directly affect interstate commerce.”
The Electronic Fund Transfer Act (EFTA) of 1978 was intended to protect individual consumers engaging in electronic fund transfers, such as transfers through automated teller machines, point-of-sale terminals, telephone bill-payment plans, and remote banking programs. The Federal Reserve Board implements the EFTA through Regulation E. With respect to electronic fund transfer systems, Congress found that “the application of existing consumer protection legislation is unclear, leaving the rights and liabilities of consumers, financial institutions, and intermediaries…undefined.”
The Federal Financial Institutions Examination Council Act of 1978, Title X of the Financial Institutions Regulatory and Interest Rate Control Act (FIRA) of 1978, created the Federal Financial Institutions Examination Council (FFIEC), a formal interagency body empowered to prescribe uniform principles, standards, and report forms for the examination of financial institutions by federal banking regulators. Section 1091 of Dodd–Frank made the CFPB a member of the FFIEC to help make recommendations that promote uniformity in the supervision of financial institutions.
The Right to Financial Privacy Act of 1978, Title XI of the Financial Institutions Regulatory and Interest Rate Control Act (FIRA) of 1978, required federal authorities to follow specific procedures in order to obtain a customer’s financial records from a financial institution. It also imposed various duties and responsibilities on the financial institutions before releasing such information. Previously, “bank customers were not informed that their personal financial records were being turned over to a government authority and could not challenge government access to the records.”
The Alternative Mortgage Transaction Parity Act (AMTPA) of 1982, Title VIII of the Garn–St. Germain Depository Institutions Act of 1982, preempted state laws that restrict banks from making any mortgage other than conventional fixed-rate amortizing mortgages. The AMTPA made possible a range of residential loan products previously prohibited in many states, such as adjustable-rate, balloon-payment, and interest-only mortgages. Congress passed the AMTPA because it believed that the “increasingly volatile and dynamic changes in interest rates have seriously impaired the ability of housing creditors to provide consumers with fixed-term, fixed-rate credit secured by interests in real property, cooperative housing, manufactured homes, and other dwellings” and that “alternative mortgage transactions are essential to the provision of an adequate supply of credit.” In other words, Congress prohibited states from preventing depository institutions from offering mortgages with features commonly associated with subprime lending because it wanted to increase the volume of loan products available in the market.
The Expedited Funds Availability Act (EFAA) of 1987, Title VI of the Competitive Equality Banking Act of 1987, regulated the manner in which banks could delay the availability of customers’ funds. It required banks to make funds deposited in transaction accounts available within specific time frames, to pay interest on interest-bearing transaction accounts in specific time frames, and to disclose their funds-availability policies to their customers.
The Fair and Accurate Credit Transactions Act (FACTA) of 2003 amended the Fair Credit Reporting Act to (among other purposes) “prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, [and] make improvements in the use of, and consumer access to, credit information.” The FACTA gave consumers the right to one free credit report per year as well as the right to information about how the credit reporting agency calculated their scores. The FACTA also required the provision of notices and credit scores to consumers in connection with denials or less favorable offers of credit.
The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) of 2008, Title V of the Housing and Economic Recovery Act of 2008, implemented licensing requirements for mortgage loan originators. It required the establishment of a national mortgage-licensing registry to (among other things) enhance consumer protection and reduce fraud.
The Federal Trade Commission Act of 1914 created the Federal Trade Commission with a dual mission to protect consumers and promote competition. It enforces antitrust laws and consumer protection law. The FTC shares authority with the CFPB to enforce consumer protection laws with respect to nonbank financial institutions.
The Gramm–Leach–Bliley Act of 1999 requires financial institutions, including lenders and mortgage brokers, to (among other things) create security programs to protect consumer privacy.
The Interstate Land Sales Full Disclosure Act of 1968, Title XIV of the Housing and Urban Development Act of 1968, was intended to protect consumers from fraud and abuse in the sale or lease of land.
The Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, was enacted primarily to require clear and uniform disclosure of interest rates paid on deposit accounts and fees assessed against deposit accounts.
The Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994 was passed to help the Federal Trade Commission protect consumers against telemarketing fraud.
The Homeowners Protection Act of 1998 was passed to protect consumers who were having difficulty cancelling their private mortgage insurance (PMI) after reaching a certain level of equity in their property. The act required automatic cancellation and notice of cancellation rights with respect to PMI.
Federal Trade Commission Divisions and Consumer Financial Protection Bureau Offices
Federal Trade Commission
- Division of Privacy and Identity Protection
- Division of Advertising Practices
- Division of Consumer and Business Education
- Division of Enforcement
- Division of Marketing Practices
- Division of Consumer Response and Operations
- Division of Financial Practices
- Division of Litigation Technology and Analysis
Consumer Financial Protection Bureau
- Research Unit
- Community Affairs Unit
- Complaint Collection and Tracking
- Office of Fair Lending and Equal Opportunity
- Office of Financial Education
- Office of Service Member Affairs
- Office of Financial Protection for Older Americans