washington dc – Today, the Consumer Financial Protection Bureau (CFPB) issued an interpretation rule when digital marketing providers of financial companies must comply with the Federal Consumer Financial Protection Act. Digital marketers involved in the identification or selection of prospective customers or the selection or placement of content to influence consumer behavior are typically legal services her providers. Digital marketers acting as service providers may be held liable by the CFPB or other law enforcement agencies for unfair, deceptive or abusive conduct or practices and other breaches of consumer financial protections. .

“When big tech companies use sophisticated behavioral targeting techniques to sell financial products, they must comply with the Federal Consumer Financial Protection Act,” said CFPB Director Rohit Chopra. “Federal and state law enforcement agencies can and should be held accountable if these companies violate the law.”

Digital marketing providers have transformed advertising. Traditional advertising relies on getting your product or service to the widest possible audience. For example, a traditional marketer may try to buy time and space for his television commercials for the most watched stations and shows. Digital marketers, on the other hand, seek to maximize the interaction between individuals and their ads. Personal data can be collected and fed into behavioral analytics models to target individuals or groups who are predicted to be more likely to interact with advertisements or sign up for products and services.

Where digital marketing providers go beyond traditional advertising, they are generally subject to consumer financial protection laws as service providers. The law includes exceptions for companies that offer only the time or space to advertise their consumer financial products or services through print, newspaper, or electronic media. However, the CFPB said today that the exception does not apply to companies that are materially involved in developing their content strategy.

Financial institutions rely on the expertise and tools of digital marketing providers to process large amounts of personal data and deliver advanced analytical techniques using machine learning and advanced algorithms to deliver targeted advertising. I’m here. Financial institutions use behavioral analytics to connect with potential customers. However, behavioral marketing and advertising can expose businesses to legal liability, depending on how these practices are designed and implemented.

Today’s interpretation rule explains:

• Digital marketers provide an important service to financial firms. A critical service is a critical or essential service. Digital marketing providers are typically substantively involved in developing content strategies when identifying or selecting prospective customers or when selecting or placing content to drive consumer engagement with advertising. Digital her marketers engaged in this type of ad targeting and delivery do not fall under the “time or space” exception, rather than merely providing ad space and time.
• The CFPB, states, and other consumer protection enforcers can sue digital marketers to stop violating consumer financial protection laws. Service Providers are liable for unfair, deceptive, or abusive acts or practices under the Consumer Financial Protection Act. When Digital Her marketers act as service providers, they are liable for violations of consumer protection laws.

Read today’s rule of interpretation, Limited Application of the “Time or Space” Exception to the Consumer Financial Protection Act for Digital Marketing Providers.

Consumers can visit the CFPB website or call (855) 411-CFPB (2372) to file a complaint about a financial product or service.

Employees who believe their company has violated the Federal Consumer Financial Protection Act are encouraged to send information about what they know to whistleblower@cfpb.gov.

The Consumer Financial Protection Bureau is a 21st-century agency that implements and enforces federal consumer finance laws and ensures that markets for consumer financial products are fair, transparent, and competitive. For more information, see: consumerfinance.gov.