Us Congress 2025-2026 Regular Session

Us Congress House Bill HB1652 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	I
2	2	119THCONGRESS
3	3	1
4	4	STSESSION H. R. 1652
5	5	To amend the Consumer Financial Protection Act of 2010 to clarify standards
6	6	for UDAAP enforcement actions brought by the Bureau of Consumer
7	7	Financial Protection, and for other purposes.
8	8	IN THE HOUSE OF REPRESENTATIVES
9	9	FEBRUARY27, 2025
10	10	Mr. B
11	11	ARRintroduced the following bill; which was referred to the Committee
12	12	on Financial Services
13	13	A BILL
14	14	To amend the Consumer Financial Protection Act of 2010
15	15	to clarify standards for UDAAP enforcement actions
16	16	brought by the Bureau of Consumer Financial Protec-
17	17	tion, and for other purposes.
18	18	Be it enacted by the Senate and House of Representa-1
19	19	tives of the United States of America in Congress assembled, 2
20	20	SECTION 1. SHORT TITLE. 3
21	21	This Act may be cited as the ‘‘Rectifying Undefined 4
22	22	Descriptions of Abusive Acts and Practices Act’’ or the 5
23	23	‘‘Rectifying UDAAP Act’’. 6
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26	26	•HR 1652 IH
27	27	SEC. 2. MITIGATING FACTORS IN ASSESSING CIVIL PEN-1
28	28	ALTIES. 2
29	29	Section 1055(c) of the Consumer Financial Protec-3
30	30	tion Act of 2010 (12 U.S.C. 5565(c)) is amended by add-4
31	31	ing at the end the following: 5
32	32	‘‘(6) R
33	33	ULEMAKING.—The Bureau shall, not 6
34	34	later than 180 days after the date of the enactment 7
35	35	of this paragraph, issue a rule that establishes poli-8
36	36	cies and procedures relating to the imposition of civil 9
37	37	monetary penalties sought under this subsection, in-10
38	38	cluding the application of the mitigating factors de-11
39	39	scribed in paragraph (3).’’. 12
40	40	SEC. 3. RULEMAKING RELATING TO UNFAIR, DECEPTIVE 13
41	41	OR ABUSIVE ACTS OR PRACTICES. 14
42	42	(a) I
43	43	NGENERAL.—Section 1031 of the Consumer Fi-15
44	44	nancial Protection Act of 2010 (12 U.S.C. 5531) is 16
45	45	amended by striking subsection (b) and inserting the fol-17
46	46	lowing: 18
47	47	(b) R
48	48	ULEMAKING.— 19
49	49	‘‘(1) I
50	50	N GENERAL.—The Bureau may prescribe 20
51	51	rules applicable to a covered person or service pro-21
52	52	vider identifying as unlawful unfair, deceptive, or 22
53	53	abusive acts or practices in connection with any 23
54	54	transaction with a consumer for a consumer finan-24
55	55	cial product or service, or the offering of a consumer 25
56	56	financial product or service. Rules under this section 26
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60	60	may include requirements for the purpose of pre-1
61	61	venting such acts or practices. 2
62	62	‘‘(2) C
63	63	OST BENEFIT ANALYSIS REQUIRED .— 3
64	64	Any final rule issued by the Bureau relating to abu-4
65	65	sive, unfair, or deceptive acts or practices shall in-5
66	66	clude a cost-benefit analysis. 6
67	67	‘‘(3) D
68	68	EFINITION OF ABUSIVE ACT OR PRAC -7
69	69	TICE.—The Bureau shall, not later than 180 days 8
70	70	after the date of the enactment of this subsection, 9
71	71	issue a rule that defines the term ‘abusive act or 10
72	72	practice’ for the purposes of this section.’’. 11
73	73	(b) O
74	74	PPORTUNITY FOR COMMENT.—The Bureau of 12
75	75	Consumer Financial Protection shall, not later than 180 13
76	76	days after the date of the enactment of this subsection, 14
77	77	allow the public to submit comments with respect to any 15
78	78	confusion about how the Bureau of Consumer Financial 16
79	79	Protection uses its authority with respect to unfair, decep-17
80	80	tive, or abusive acts or practices. 18
81	81	SEC. 4. AUTHORITY TO DECLARE AN ACT UNLAWFUL 19
82	82	BASED ON DISCRIMINATION. 20
83	83	The Bureau of Consumer Financial Protection may 21
84	84	not interpret the authority of the Bureau of Consumer Fi-22
85	85	nancial Protection relating to unfair, deceptive, or abusive 23
86	86	acts and practices, as such term is used in section 1031 24
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89	89	•HR 1652 IH
90	90	of the Consumer Financial Protection Act of 2010, to in-1
91	91	clude discriminatory practices. 2
92	92	SEC. 5. CLARIFYING THE ABUSIVE STANDARD FOR THE BU-3
93	93	REAU OF CONSUMER FINANCIAL PROTEC-4
94	94	TION. 5
95	95	Section 1031 of the Consumer Financial Protection 6
96	96	Act of 2010 (12 U.S.C. 5531) is amended by striking sub-7
97	97	section (d) and inserting the following: 8
98	98	‘‘(d) A
99	99	BUSIVE.— 9
100	100	‘‘(1) I
101	101	N GENERAL.—The Bureau shall have no 10
102	102	authority to declare an act or practice of a covered 11
103	103	person abusive in connection with the provision of a 12
104	104	consumer financial product or service, unless the act 13
105	105	or practice— 14
106	106	‘‘(A) intentionally and materially interferes 15
107	107	with the ability of a consumer to understand a 16
108	108	term or condition of a consumer financial prod-17
109	109	uct or service; or 18
110	110	‘‘(B) takes unreasonable advantage of— 19
111	111	‘‘(i) a lack of understanding by the 20
112	112	consumer with respect to the possible im-21
113	113	pact, material risks, costs, or conditions of 22
114	114	the product or service, or the likelihood of 23
115	115	the risks, costs, or conditions of the prod-24
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118	118	•HR 1652 IH
119	119	uct or service negatively affecting the con-1
120	120	sumer; and 2
121	121	‘‘(ii) the reasonable reliance the con-3
122	122	sumer places on an affirmative action or 4
123	123	representation of such covered person to 5
124	124	induce such consumer to rely on such ac-6
125	125	tion or representation. 7
126	126	‘‘(2) A
127	127	BUSIVE ACTIONS.—Conduct of a covered 8
128	128	person shall be considered abusive if— 9
129	129	‘‘(A) the act or practice causes or is likely 10
130	130	to cause substantial injury to consumers which 11
131	131	is not reasonably avoidable by consumers, pro-12
132	132	vided, however, that if the act or practice was 13
133	133	timely, clearly and conspicuously disclosed to 14
134	134	consumers, the injury is presumed to be reason-15
135	135	ably avoidable; or 16
136	136	‘‘(B) such substantial injury is not out-17
137	137	weighed by countervailing benefits to consumers 18
138	138	or to competition. 19
139	139	‘‘(e) G
140	140	OOD-FAITHEFFORTTOCOMPLY.— 20
141	141	‘‘(1) I
142	142	N GENERAL.—The Bureau may not seek 21
143	143	monetary relief from a covered person under this 22
144	144	section unless the covered person has not established 23
145	145	by a preponderance of the evidence that they made 24
146	146	a good-faith effort to comply. 25
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150	150	‘‘(2) AUTHORITY TO SEEK LEGAL OR EQUI -1
151	151	TABLE REMEDIES.—The limitation described in sub-2
152	152	paragraph (A) shall not restrict the authority of the 3
153	153	Bureau to seek legal or equitable remedies, such as 4
154	154	damages and restitution, to redress an identifiable 5
155	155	consumer injury caused by the abusive acts or prac-6
156	156	tices of such covered person.’’. 7
157	157	SEC. 6. NOTICE AND OPPORTUNITY TO CURE. 8
158	158	Section 1031 of the Consumer Financial Protection 9
159	159	Act of 2010 (12 U.S.C. 5531) is amended by adding at 10
160	160	the end the following: 11
161	161	‘‘(g) N
162	162	OTICE ANDOPPORTUNITYTOCURE.— 12
163	163	‘‘(1) I
164	164	N GENERAL.—If a covered person self- 13
165	165	identifies a potential unfair, deceptive, or abusive act 14
166	166	or practice carried out by such covered person, the 15
167	167	Bureau shall, not later than 90 days after such self- 16
168	168	identification, provide a written notice in the form of 17
169	169	a potential action and request for response letter or 18
170	170	a notice and opportunity to respond and advise let-19
171	171	ter of the potential unfair, deceptive, or abusive act 20
172	172	or practice to such covered person and inform the 21
173	173	covered person that such person has 180 days after 22
174	174	the date the covered person receives such notice to 23
175	175	cure such potential unfair, deceptive, or abusive act 24
176	176	before the Bureau may pursue other legal action. 25
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180	180	‘‘(2) TOLLING OF STATUTE OF LIMITATIONS .— 1
181	181	Any applicable statute of limitations that applies to 2
182	182	conduct under which the Bureau has given notice 3
183	183	and an opportunity to cure shall not toll until— 4
184	184	‘‘(A) the covered person cures the potential 5
185	185	abusive, unfair, or deceptive act or practice and 6
186	186	notifies the Bureau that such act or practice 7
187	187	has been cured; 8
188	188	‘‘(B) the covered person notifies the Bu-9
189	189	reau that such covered person will not cure the 10
190	190	act or practice; or 11
191	191	‘‘(C) the 180-day period to cure ends.’’. 12
192	192	SEC. 7. ABUSIVE, UNFAIR, OR DECEPTIVE ACTS OR PRAC-13
193	193	TICES ENFORCEMENT ACTIONS. 14
194	194	(a) I
195	195	NGENERAL.—Subtitle E of title X of the Con-15
196	196	sumer Financial Protection Act of 2010 (12 U.S.C. 5561 16
197	197	et seq.) is amended by adding at the end the following 17
198	198	new section: 18
199	199	‘‘SEC. 1059. UNFAIR, DECEPTIVE, OR ABUSIVE ACTS OR 19
200	200	PRACTICES ENFORCEMENT ACTIONS. 20
201	201	‘‘Enforcement actions brought by the Bureau under 21
202	202	section 1031 under this title shall be brought in— 22
203	203	‘‘(1) the United States district court located 23
204	204	where the covered person has its headquarters loca-24
205	205	tion; or 25
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209	209	‘‘(2) the United States District Court for the 1
210	210	District of Columbia.’’. 2
211	211	(b) A
212	212	CTIONSUNDERSECTION1031.—Section 1031 3
213	213	of the Consumer Financial Protection Act of 2010 is 4
214	214	amended by adding at the end the following: 5
215	215	‘‘(g) E
216	216	NFORCEMENTACTIONS.— 6
217	217	‘‘(1) I
218	218	N GENERAL.—If the Bureau brings an 7
219	219	enforcement action under this section, the Bureau 8
220	220	shall state with particularity the circumstances that 9
221	221	the Bureau alleges constitute violation of this sec-10
222	222	tion. 11
223	223	‘‘(2) A
224	224	LTERNATIVE CLAIMS .—If the Bureau 12
225	225	brings an enforcement action under this section— 13
226	226	‘‘(A) claiming that an activity is unfair or 14
227	227	deceptive, the Bureau may not claim in the al-15
228	228	ternative that the activity is abusive; and 16
229	229	‘‘(B) claiming that an activity is abusive, 17
230	230	the Bureau may not claim in the alternative 18
231	231	that the activity is unfair or deceptive.’’. 19
232	232	SEC. 8. LOOK-BACK PROVISIONS FOR THE CONSUMER FI-20
233	233	NANCIAL PROTECTION BUREAU. 21
234	234	Subtitle B of title X of the Consumer Financial Pro-22
235	235	tection Act of 2010 (12 U.S.C. 5511 et seq.) is amended 23
236	236	by adding at the end the following new section: 24
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240	240	‘‘SEC. 1029B EXAMINATION PERIOD LIMITATIONS. 1
241	241	‘‘(a) I
242	242	NGENERAL.—When enforcing Federal con-2
243	243	sumer financial laws, the Bureau may not seek a civil 3
244	244	money penalty for any violating conduct that occurred 4
245	245	prior to the most recent assignment of a consumer compli-5
246	246	ance rating. 6
247	247	‘‘(b) R
248	248	ULE OFCONSTRUCTION.—This limitation de-7
249	249	scribed in subsection (a) may not be construed to restrict 8
250	250	the ability of the Bureau to seek other forms of legal or 9
251	251	equitable relief available under subparagraphs (A) through 10
252	252	(G) of section 1055(a)(2) for any violating conduct that 11
253	253	occurred prior to the most recent assignment of a con-12
254	254	sumer compliance rating.’’. 13
255	255	Æ
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