CFPB interpretation includes digital marketing providers

On August 10, the CFPB announced that digital marketing providers involved in identifying or selecting prospective customers or selecting or placing content to influence consumer engagement, including purchasing or hiring behavior, are subject to CFPB jurisdiction. issued an interpretation rule to indicate. The rule clarifies the scope of companies that are “service providers” under the CFPA, and includes digital marketing providers, subject to the CFPB’s authority to prohibit UDAAPs.

The CFPB’s jurisdiction generally applies to “subjects,” or “any person engaged in the provision or provision of consumer financial products or services.” The jurisdiction of the Department also extends to “Service Providers” who provide “essential services” to Covered Persons in connection with the provision of consumer financial products or services. However, the term “service provider” shall not include (i) “support or similar services of the type generally provided to businesses” or (ii) “time or space for the advertising of consumer financial products.” ” is not included. or services in print, newspaper or electronic media. ”

Under the Interpretive Rules, digital marketing providers are involved in the development of content strategies, and to the extent that they identify or select prospective customers or select or place content to facilitate consumer engagement with advertising, service providers It is said that The CFPB also said digital his marketers involved in targeting and delivering this type of ad do not fall under the “time or space” exception, rather than simply providing ad space and time.

The rule also explains that “states and other consumer protection enforcers can sue digital marketers who may be liable to the UDAAP.” In a related statement, CFPB director Rohit Chopra said:[w]If a big tech company sells financial products using sophisticated behavioral targeting techniques, it must comply with the Federal Consumer Financial Protection Act.

Practice: The rule would require third-party provision of data, including a number of marketing strategy firms that could be subject to scrutiny, especially if the CFPB considers the data to be a conduit for discrimination, especially if the CFPB recently viewed the UDAAP. important to users (see below). See previous blog post here). Additionally, the CFPB has held service providers liable for knowingly or recklessly providing “substantial assistance” to businesses that violate the Consumer Financial Services Act. shall be deemed to be in violation of the law to the same extent as the person to whom such assistance was provided. Within the context of her digital marketing provider, the use of substantive assistance enforcement mechanisms reappears as a common method for her CFPB to track parties who may not appear to have directly engaged in illegal activity. may float.