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As a new NAFCU Compliance Blog post explains the application of the Federal Trade Commission's (FTC) Telemarketing Sales Rule (TSR) to credit unions, the CFPB Monday announced it had settled with a company that provided military travel lending and servicing for violating several consumer protection laws – including the TSR.

In the blog, NAFCU Regulatory Compliance Counsel David Park notes the TSR doesn't receive as much coverage as the Telephone Consumer Protection Act (TCPA), which NAFCU works closely with lawmakers and administration officials to modernize to ensure credit unions can contact members with important financial information without fear of violating the law.

The TSR implements the Telemarketing and Consumer Fraud and Abuse Prevention Act. While they do not apply directly to federal credit unions – institutions that are outside the FTC's scope of jurisdiction – they do apply to state-chartered credit unions. In addition, third-party vendors that federal credit unions use for telemarketing-type activities could fall under the commission's jurisdiction and would be required to comply with the act and TSR.

Park shares FTC tools that credit unions can use to determine if the TSR applies to them and how to comply with its requirements. Access more background information and resources on these member communication issues through Park's blog.

In the CFPB's settlement with Easy Military Travel, its principal Brandon Edmiston, and USA Service Finance, the bureau found Easy Military Travel had not only violated the TSR, but also the Consumer Financial Protection Act (CFPA) and Truth in Lending Act (TILA) as it sold and financed airline tickets to military servicemembers and their families from 2010-2016. It violated the TSR by failing to provide consumers with the total costs of purchasing airline tickets through financing. Read more here.