On March 22, the CFPB issued Compliance Bulletin 2022-05 regarding potentially illegal practices related to consumer reviews. The guidance states that consumer reviews impact company revenue and help consumers choose between financial providers, which can in turn “incentivize dishonest market participants to attempt to manipulate the review process, rather than compete based on the value of their services, which can frustrate a competitive marketplace.”
The guidance begins by noting that form contracts used to restrict consumer reviews by imposing a monetary or other penalties for publishing negative comments regarding the provider’s services or products are harmful to consumers and “void from the inception of such contract.” Citing to the Bureau’s authority to prohibit “unfair, deceptive, or abusive act or practices” (UDAAPs), the guidance states that invoking void or unenforceable contract provisions can also be “deceptive”: “Consumers can be expected to read the language to mean what it says: that they are restricted in their ability to provide consumer reviews. But that is not the case, since the provision is void under applicable law.”
The CFPB also plans to apply its similar “unfairness” principles to financial intuitions and service providers that use contractual restrictions to restrict consumer reviews. Such conduct “can unfairly harm the many other consumers who rely upon reviews when deciding what products and services to purchase.”
The guidance also notes that...
NEW HAVEN — A New Haven man pleaded guilty Friday to making false claims to the IRS after he was accused of fraudulently obtaining nearly $257,000 in COVID-19 relief funds, federal prosecutors sai...