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The CFPB issued an interpretive rule on Wednesday to clarify that certain digital marketing advertisers will be regarded as service providers under the Consumer Financial Protection Act (CFPA) and will be subject to the law’s conditions, including the CFPB’s unfair, deceptive, or abusive acts or practices (UDAAP) authority.  

The interpretative rule states that digital marketing providers do not fall within the “time or space” exception of the CFPA if they target and deliver advertisements through algorithms and data. The bureau notes that “identifying prospective customers and then attempting to acquire those customers is a significant component of the ‘offering’ of a consumer financial product or service,” making the digital marketer equivalent to a service provider and held to the conditions of the CFPA.  

NAFCU has long advocated for the bureau to exercise its authority in a way that allows competitive equality between credit unions and fintech companies, and the association believes this interpretive rule is a step in the right direction.  

“When Big Tech firms use sophisticated behavioral targeting techniques to market financial products, they must adhere to federal consumer financial protection laws,” stated CFPB Director Rohit Chopra. “Federal and state law enforcers can and should hold these firms accountable if they break the law."      

For fintech companies engaged in a combination of marketing and data aggregation activities, the interpretive rule ensures that those companies are subject to the same set of consumer financial protection rules which apply to credit unions under the CFPA, helping to ensure a level playing field.  

While an interpretive rule isn’t subject to notice and comment rulemaking procedures, NAFCU will continue to engage the bureau to communicate any potential concerns, guard against unwarranted expansion of UDAAP liability for credit unions, and ensure a level playing field between credit unions and fintech companies.