On March 11, 2021, the Consumer Financial Protection Bureau (CFPB or “Bureau”) issued a Rescission of Statement of Policy rescinding its January 24, 2020 Policy Statement regarding the prohibition on abusive acts or practices (“2020 Policy Statement”). The CFPB indicates that it is rescinding the 2020 Policy Statement “to better protect consumers and the marketplace … and to enforce the law as Congress wrote it.” The Bureau’s action signals a return to the “Know It When You See It” standard for UDAAP abusiveness, which will require regulated entities to “read the tea leaves” based on allegations in enforcement actions and statements in CFPB supervisory guidance and the CFPB examination manual.
Read our client alert.