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Subcommittee wrestles with CFPB’s UDAAP ‘abusiveness’ standard and calls for clearer rulemaking
Summary
Witnesses asked Congress to clarify the CFPB’s prohibition on abusive acts or practices (the ‘abusiveness’ prong of UDAAP), recommending that the bureau define the standard through notice-and-comment rulemaking rather than by enforcement action.
Several witnesses told the House subcommittee that the CFPB’s prohibition on “abusive” acts or practices (the second prong of the UDAAP standard) remains insufficiently defined and leads to enforcement uncertainty.
“The concept of abusive does not [have] a long history,” Rebecca Keane said, and the bureau’s cases “have been inconsistent in applying the abusiveness prongs to similar facts and circumstances.” Keane recommended that the CFPB “be required to clearly…
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