What is the Consumer Financial Protection Act?

The Consumer Financial Protection Act was passed in 2010 as part of the Dodd-Frank Act with the purpose of establishing the Consumer Financial Protection Bureau (CFPB).The CFPB and FTC overlap in authority to administer consumer laws. The CFPB has broad authority to regulate federal financial consumer laws including offer and sale of consumer financial products. It seeks to promote market transparency and competitiveness by making certain that consumer financial protection regulations are applied consistently. It has rulemaking and enforcement authority. 

How is the Consumer Financial Protection Bureau Organized?

The CFPB is divided into four offices:

Office of Fair Lending and Equal Opportunity - This office is charged with oversight and enforcement of federal laws intended to ensure access to credit;

Office of Financial Education - This office is charged with educating consumers on financial decisions;

Office of Service Member Affairs - This office is charged with developing and implementing initiatives for military service members and their families; and

Office of Financial Protection for Older Americans - This office is charged with facilitating the financial literacy of individuals 62 years old and older.

What is the Authority of the CFPB?

The CFPB has exclusive administrative rulemaking authority for most matters affecting consumer protection. The bureau also conducts investigations into allegations of consumer fraud. Based upon the results of investigation, it may bring administrative or civil actions against covered persons for violating consumer protection laws. A covered person is any person or business offering or providing consumer financial products or services. Certain entities are exempt from CFPB authority, including: insurance companies, Internet service providers, real estate agents, lawyers, car dealers, and persons regulated by the SEC. The CFPB has exclusive authority to enforce consumer protection laws against non-depository institutions and insured depository institutions with $10 billion or more in assets.

Note: The CFPB works closely with an authorized consumer advisory board to advise and consult with the CFPB in the exercise of its functions.

How does States Regulate Consumer Laws?

Pursuant to Title X of the CFPA, states may also regulate consumer protection, as long as state regulation does not conflict with federal laws. States may also bring actions to enforce federal consumer protection laws. Title X allows the application of state law to national banks. Federal law does preempt a states ability to enforce consumer protection law against national banks and other federal financial institutions if:

• the application of the state law would have a discriminatory effect on the national bank or thrift;
• the state law prevents or significantly interferes with the exercise of the national bank or thrifts powers; or
• the state consumer law is preempted by another federal law.

Related Topics

• Consumer Protection Law (Intro)
• What is consumer protection law?
• Cooling Off Rule
• What major federal laws protect consumers?
• What is the Federal Trade Commission
• Enforcement procedures of the FTC?
• Penalties for violating FTC regulations?
• Commercial Practices Prohibited by FTC?
• Unfair Trade Practices 
  
• Predatory Pricing
• Bait & Switch
• Lemon Laws
• Consumer Financial Protection Bureau
• What is the Fair Credit Reporting Act?
• Users of Information?
• Credit Reporting Agency Consumers
• Reporting Agencies?
• Consumer Reporting Agency
• Furnishers of Information?
• Enforcement?
• Truth in Lending Act
• Fair Debt Collection Practices Act
• Fair Credit Billing Act
• Electronic Funds Transfer Act
• Electronic Funds Transfers (EFT)
• Equal Credit Opportunity Act
• Regulation B
• Consumer Credit Protection Act
• Consumer Advisory Council
• Consumer Financial Protection Act
  
• Consumer Product Safety Act
• Consumer Product Labeling Laws
• Credit Repair Organization Act
• Federal Food, Drug, and Cosmetic Act
• Magnuson-Moss Warranty Act
• Privacy Act of 1974 (Privacy Act)
• Personally Identifiable Information
• Right to Financial Privacy Act of 1978 (RFPA)
• Electronic Communication Privacy Act of 1986 (ECPA)
• Childrens Online Privacy Protection Act of 1986 (COPPA)
• Privacy Policy
• CAN SPAM Act
• What role do states play in Consumer Protection?