The Director of Consumer and Community Affairs of the Federal Reserve Board asked the Federal Trade Commission, or FTC, for information concerning the FTC’s enforcement activities related to compliance with the following regulations: Regulation B (Equal Credit Opportunity); Regulation E (Electronic Fund Transfer); Regulation M (Consumer Leasing) and Regulation Z (Truth in Lending), among other things.
The FTC responded in part by noting that under the Dodd-Frank Act, the FTC retains its authority to enforce Regulations B, E, M, and Z (and was granted the authority to enforce any Bureau of Consumer Financial Protection, or CFPB, rules) regarding the entities within the FTC’s jurisdiction, which includes most providers of financial services that are not banks, thrifts, and federal credit unions. The Dodd-Frank Act requires that the FTC and the CFPB coordinate certain law enforcement activities, and negotiate an agreement to do so by January 21, 2012. The FTC noted it is committed to continuing to vigorously enforce Regulations B, E, M, and Z. The FTC stated it looks forward to coordinating with the Federal Reserve Board, the CFPB, and other federal agencies in the implementation of the Dodd-Frank Act.
The Dodd-Frank Act assigns the FTC new enforcement authority regarding payment cards by adding a new Section 920 to the Electronic Funds Transfer Act, or EFTA, which, among other things, restricts certain practices related to debit and credit card transactions. These new provisions generally address business-to-business relationships and interactions between merchants, networks, issuers, and acquirers in the payment card transaction process. The Federal Reserve Board must issue several implementing regulations regarding certain of the new EFTA requirements, and it recently issued new proposed rules to implement the debit card interchange fee and routing provisions of the Dodd-Frank Act. The FTC has responsibility for enforcing the new requirements and any implementing regulations for payment card networks and certain other nonbank entities, such as non-federally chartered credit unions, that are covered by the rules. The FTC noted that it is continuing to monitor this area.
The FTC stated that in connection with the Dodd-Frank Act, the FTC’s staff has been engaged in ongoing and significant coordination with the U.S. Department of the Treasury regarding a possible new mortgage shopping form and streamlined mortgage disclosures, including those that may relate to the Truth In Lending Act, or TILA, and the Real Estate Settlement Procedures Act. The FTC pointed out that its staff has previously conducted research on mortgage disclosures generally, and it continues to be actively involved in evaluating the efficacy of such disclosures.
Finally, Section 1029 of the Dodd-Frank Act gives the FTC new and expanded authority regarding motor vehicle dealers. The FTC retains its current law enforcement authority over motor vehicle dealers, although it will share that authority with the CFPB with respect to dealers engaged in certain practices. The FTC also obtains new authority as of July 21, 2011, to issue rules prohibiting unfair and deceptive acts and practices in connection with motor vehicle dealers, using the notice and comment rulemaking procedures in Section 553 of the Administrative Procedure Act rather than the more elaborate rulemaking procedures in Section 18 of the FTC Act. The FTC stated that in connection with this new authority, the FTC is conducting outreach activities and reviewing a wide range of motor vehicle dealer practices. Section 1029 of the Dodd-Frank Act also requires the FTC and the Federal Reserve Board to coordinate with the CFPB’s Office of Service Member Affairs to address certain motor vehicle issues related to members of the military. The FTC stated it looks forward to working with the Federal Reserve Board, the CFPB, and other federal agencies on this initiative.
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