The American Bankers Association (ABA) welcomes and strongly supports the recently introduced H.R. 6789, the "Rectifying UDAAP Act." This important piece of legislation would amend the Consumer Financial Protection Act of 2010 to clarify standards for unfair, deceptive, and abusive acts and practices (UDAAP) enforcement actions brought by the Consumer Financial Protection Bureau.
In recent years, the banking industry and the broader financial services market have been left without clarity of the definition of the term "abusive" and have received inadequate guidance from the CFPB on what would constitute a UDAAP violation. Chairman Barr's Rectifying UDAAP Act would more clearly define the Bureau's authority with respect to UDAAP actions and would rein in the Bureau's overly aggressive stance on "abusive" acts or practices by requiring it to prove intentional misconduct. This bill would also make clear that the Bureau's UDAAP authority does not extend to discriminatory practices, which are already governed by our nation's anti-discrimination laws.
Thank you for your leadership on these policies, and we look forward to continuing to work with you and your staff to address these critical issues.