CFPB Bulletin 2017-01

The bulletin provides guidance to covered persons and service providers about the potential for violations of sections 1031 and 1036 of the Dodd-Frank Wall Street Reform and Consumer Protection Act’s prohibition on engaging in unfair, deceptive, or abusive acts or practices (UDAAPs) when assessing phone pay fees.

“Lack of employee monitoring or service provider oversight may lead to misrepresentations or failure to disclose available options and fees. A number of entities have policies and procedures in place requiring phone representatives to disclose all available phone pay options and fees to consumers, including requiring the use of detailed phone scripts. But deviations from call scripts may potentially cause phone representatives to misrepresent the available phone payment options and fees resulting in a consumer being charged a higher fee than otherwise would have been applicable. Entities can reduce the risk of misrepresentations through adequate monitoring.”