Alert: Consumer Financial Protection Agency

To:AAF Members
From: Clark Rector, Executive Vice President-Government Affairs
Re: The Consumer Financial Protection Agency

The House Energy and Commerce Committee is scheduled to start markup on H.R. 3126, the Consumer Financial Protection Agency Act on Thursday.  The bill has passed the House Financial Services Committee.  If the legislation is enacted as is, it would have serious implications for the advertising industry.

The bill as written would transfer much of the regulatory authority for financial products and services from the Federal Trade Commission to the new CFPA.  However, the FTC would retain some authority in financial products and services matters.  The bill would greatly expand the regulatory authority of both agencies.  For example:
  • The bill would grant the new CFPA rulemaking authority under the vague and unclear "unfairness" standard.  This goes beyond the current authority of the FTC which was rightly limited by Congress.
  • The FTC would be given greatly expedited rulemaking authority, doing away with many of the rigorous safeguards currently in place.
  • The Commission would be granted expanded "aiding and abetting" authority that could implicate both advertising agencies and the media.

In addition, H.R. 3126 would give the states authority to enforce regulations adopted by the CFPA and enact their own, even stricter, laws.  Financial advertisers could be subject to regulation by the CFPA, the FTC and numerous states under different and potentially contradictory standards.

It is very important that the advertising industry contact members of the Energy and Commerce Committee and ask them to slow down and consider the implications of the bill that is before them.  We are not requesting that they kill the bill, but rather that they take the time to look at the implications of the legislation before them and consider language that would provide appropriate safeguards for both consumers and the industry.

Committee members can be reached through the Energy and Commerce website at  Please do not hesitate to contact me if you have any comments or questions.