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Revises how the consumer finance regulator defines, writes rules for, and enforces unfair, deceptive, or abusive acts or practices. It narrows the “abusive” standard, requires cost‑benefit analysis for UDAAP rules, bars treating discrimination as a UDAAP violation, and adds new procedures before penalties or lawsuits can proceed. Firms that self‑identify potential problems get a 180‑day cure period after the Bureau’s notice. Enforcement must be filed either where the company is headquartered or in D.C., with detailed allegations and no “alternative” U/D/A pleading. Civil money penalties are limited in several ways, including a bar on penalties for conduct that occurred before the firm’s most recent consumer compliance rating. The Bureau must also issue rules within 180 days on penalty policies and how mitigating factors apply.
Adds a new paragraph (6) titled “Rulemaking” to Section 1055(c) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5565(c)). The new paragraph directs the Bureau to issue a rule on policies and procedures for civil monetary penalties under that subsection.
The Bureau must, not later than 180 days after the date of enactment of this paragraph, issue a rule that establishes policies and procedures relating to the imposition of civil monetary penalties sought under this subsection, including the application of the mitigating factors described in paragraph (3) .
Amends Section 1031 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5531) by striking existing subsection (b) and inserting a new subsection (b) that governs rulemaking on unfair, deceptive, or abusive acts or practices.
Authorizes the Bureau to prescribe rules applicable to a covered person or service provider that identify as unlawful unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a consumer financial product or service, or the offering of such a product or service. Rules may include requirements to prevent those acts or practices.
Requires that any final rule issued by the Bureau relating to abusive, unfair, or deceptive acts or practices must include a cost‑benefit analysis.
Replaces existing subsection (b) to (1) retain rulemaking authority, (2) require any final rule relating to abusive, unfair, or deceptive acts or practices to include a cost-benefit analysis, and (3) require the Bureau to issue a definitional rule for "abusive act or practice" and to solicit public comment within 180 days after enactment.
Adds a new section (designated 1029B) to Subtitle B of title X (12 U.S.C. 5511 et seq.) establishing a limitation on the Bureau's ability to seek civil money penalties for conduct that occurred prior to the most recent assignment of a consumer compliance rating, while preserving the Bureau's ability to seek other forms of relief listed in section 1055(a)(2)(A)–(G).
Adds a new section 1059 to Subtitle E of title X (12 U.S.C. 5561 et seq.) establishing venue for enforcement actions brought by the Bureau. The enactment also adds subsection (g) to section 1031 of the Consumer Financial Protection Act of 2010 imposing pleading particularity and prohibiting alternative claims between abusive and unfair/deceptive theories.
Adds a new paragraph (6) to subsection (c) requiring the Bureau to issue a rule within 180 days establishing policies and procedures for imposing civil monetary penalties, including how paragraph (3)'s mitigating factors are applied.
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Referred to the House Committee on Financial Services.
Introduced February 27, 2025 by Garland H. Barr · Last progress February 27, 2025
Referred to the House Committee on Financial Services.
Introduced in House