Consumer Protection News December 2016

The following is a compendium of information that may be of interest to our AG offices who are dealing with consumer protection issues. Neither the National Association of Attorneys General nor the National Attorneys General Training & Research Institute expresses a view as to the accuracy of the matters, nor as to the position expounded by the authors of the hyperlinked materials.

Legislation

Consumer Review Fairness Act of 2016

The U.S. House of Representatives and Senate have passed HB 5111, a measure which will make a provision of a form contract void from the inception if it: (1) prohibits or restricts an individual who is a party to such a contract from engaging in written, oral, or pictorial reviews, or other similar performance assessments or analyses of, including by electronic means, the goods, services, or conduct of a person that is also a party to the contract; (2) imposes penalties or fees against individuals who engage in such communications; or (3) transfers or requires the individual to transfer intellectual property rights in review or feedback content (with the exception of a nonexclusive license to use the content) in any otherwise lawful communications about such person or the goods or services provided by such person.

Under the proposed legislation, enforcement authority is provided to both the Federal Trade Commission (FTC) and the states. The proposed law also makes it unlawful for a person to offer a form contract containing such a void provision and the use of such a contract would be treated as an unfair or deceptive act or practice under the Federal Trade Commission Act (15 U.S.C. 45(a)(2)). State attorneys general are authorized to enforce the provision of this proposed law when they have reason to believe that an interest of the residents of the state has been or is threatened or adversely affected by a practice that violates the prohibition. The attorneys general may, as parens patriae, bring a civil action for enforcement in U.S. district court. If the FTC institutes a civil or administrative action, state attorneys general may not, during the pendency of such action, bring their own action for the same violation.

The matter is now awaiting action by the President as of the time of this publication.

Consumer Financial Protection Bureau

Fall 2016 Rulemaking Agenda

The CFPB has released its Fall 2016 rulemaking agenda. This agenda is published twice a year and updates the Unified Agenda. Some of the topics contained in this release include the Know Before You Owe mortgage disclosure rule, other rules under the Home Mortgage Disclosure Act, larger participants, and non-depository lender registration, arbitration, payday, auto title, and similar lending products, and debt collection.

Final Rule

Consumer Leasing (Regulation M) Annual Threshold Adjustments

As of November 30, 2016, the Board and the Bureau were finalizing amendments to the commentary for the agencies’ regulations that implement the Consumer Leasing Act. These amendments affect the calculation method for determining the annual adjustment of the dollar threshold for exempt consumer leases and set the 2017 exemption threshold amount. The exemption remains at $54,600 through 2017.

Final Rule

Appraisals for Higher-Priced Mortgage Loans Exemption Threshold Adjustments

The Agency' rules exempted, among other loan types, transactions of $25,000 or less, and required that this loan amount be adjusted annually based on any annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Posted November 30, 2016

Final Rule

Truth in Lending (Regulation Z) Threshold Adjustments

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) amended TILA by requiring that the dollar threshold for exempt consumer credit transactions be adjusted annually by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

Final Rule

Fair Credit Reporting Act Disclosures

The ceiling on allowable charges under section 612(f) of the Fair Credit Reporting Act will remain unchanged at $12.00 for 2017.

CFPB Monthly Complaint Report, Vol. 17 (November 2016) Available

http://www.consumerfinance.gov/data-research/research-reports/

Snapshot of Servicemember Complaints

The CFPB has released a review of issues related to VA mortgage financing. This report reviews and analyzes about 1,800 complaints from servicemembers, veterans, and their families related to mortgage refinancing.

Federal Communications Commission

Enforcement Bureau Issues Robotext Advisory

The FCC’s Enforcement Bureau has issued an Advisory to promote understanding of the clear limits on the use of autodialed text messages, also known as robotexts. The Advisory was issued November 18, 2016.

FCC Signs Robocall Agreement with Canadian Regulator

The FCC’s Enforcement Bureau and the Canadian Radio-Television and Telecommunications Commission have announced a formal agreement committing the two agencies to work together to combat unlawful robocalls. The Memorandum of Understanding addresses both robocalling and caller ID spoofing.

Federal Trade Commission

Mobile-Friendly Financial Readiness Website

The FTC has unveiled a financial readiness website designed for mobile devices to help members of the military navigate personal financial decisions in light of the unique challenges they face, such as frequent relocations and deployment. The website, Military.Consumer.gov, was created with the Department of Defense, the Consumer Financial Protection Bureau, Military Saves, and other partners.

Final Changes to Used Car Rule

The FTC has announced final amendments to its Used Car Rule. The Rule, formally known as the Used Motor Vehicle Trade Regulation Rule, revises the “Buyers Guide” on used cars offered for sale.

Advisory Opinion

Telemarketing Sales Rule Applicability Regarding Soundboarding Technology

The FTC has issued a staff advisory opinion letter concerning the Telemarketing Sales Rule’s applicability to calls utilizing soundboarding technology. This opinion letter clarifies a previous opinion letter issued in 2009 and concerns provisions governing outbound telemarketing calls that deliver prerecorded messages utilizing soundboard technology. This technology allows a live agent to communicate with a call recipient by playing recorded audio snippets instead of using his or her own live voice.

FTC Links to websites and key campaigns:

Consumer.ftc.gov

Consumer.gov

Business.ftc.gov

IdentityTheft.gov

Ftc.gov/PassItOn

Ftc.gov/fotonovela

Ftc.gov/bulkorder

Ftc.gov/complaint

Ftc.gov/OnGuardOnline

Other Items of Interest

OCC Considering Fintech Charter Applications, Seeking Comments

The Comptroller of the Currency has announced that the Office of the Comptroller of the Currency would move forward with considering applications from financial technology (fintech) companies to become special purpose national banks. The OCC has published a paper discussing the issues and conditions that the agency will consider in granting these special purpose national bank charters; it is available on the agency’s website at occ.gov. Comments may be submitted through January 15, 2017.


Mark Neil is the Editor of Consumer Protection News and may be reached at 202-326-6019. Consumer Protection News is a publication of the National Association of Attorneys General (NAAG). Any use and/or copies of this newsletter in whole or in part must include the customary bibliographic citation. NAAG retains copyright and all other intellectual property rights in the material presented in this publication. For content submissions or to contact the editor directly, please e-mail mneil@naag.org.

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