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Blog

UDAP (Unfair and Deceptive Acts or Practices)

David Dickinson

By David Dickinson

This is the second installment about things I learned while at the ABA's Regulatory Compliance Conference.  Here's another short piece on what I learned in a session on UDAP - something we don't talk about much, but is very ugly if the regulators believe your institution is involved in a deceptive act.  These are my notes and not necessarily complete sentences.

  • There is a bill in Congress to allow FTC to be more involved in the regulation of banks (directly).
  • What's deceptive?  You'd better be able to substantiate it BEFORE you make the claim.
  • Every State has a "UDAP like" law
  • New Proposal will expand Reg AA
    • Was limited (Credit Practices Rule).  The proposed rules have more "teeth" and coverage
    • Congress is getting involved.
    • Credit card & ODP targeted.
  • Exposure beyond Marketing
    • Fulfillment has to match promises
    • Even if years later and there has been system changes
  • "Combined Balance" = my account + ODP/HELOC/OD LOC will get you a UDAP violation and FTC referral.  No question.
  • Bottom line:  The "net impression" is what matters.

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This entry was posted on July 3rd, 2008 at 12:00 am. RSS | Back to Blog Homepage.


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