United States 118th Congress Status: Died 1 R cosponsors

HR 6789 — Rectifying UDAAP Act

Last action — Referred to the House Committee on Financial Services.

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. Died in session

This bill died with 118th Congress. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.

This bill is no longer active — its legislative session has ended, so there is no live prognosis. It would have to be reintroduced in the current session to move again.

Summary

To amend the Consumer Financial Protection Act of 2010 to clarify standards for UDAAP enforcement actions brought by the Bureau of Consumer Financial Protection, and for other purposes.

Bill Text

Sections of law this bill changes

4 sections in 1 law

From the bill's own amending language, matched to the official United States Code (current through Public Law 119-124).

Wall street reform and consumer protection · 12 U.S.C. ch. 53 2 sections Amends the act as a whole
  • § 5531 Prohibiting unfair, deceptive, or abusive acts or practices Amends

    12 U.S.C. § 5531

    The law today

    (a) In general The Bureau may take any action authorized under part E to prevent a covered person or service provider from committing or engaging in an unfair, deceptive, or abusive act or practice under Federal law in connection with any transaction with a consumer for a consumer financial product or service, or the offering of a consumer financial product or service. (b) Rulemaking The Bureau may prescribe rules applicable to a covered person or service provider identifying as unlawful unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a consumer financial product or service, or the offering of a consumer financial product or service. Rules under this section may include requirements for the purpose of preventing such acts or practices. (c) Unfairness (1) In general The Bureau shall have no authority under this section to declare an act or practice in connection with a transaction with a consumer for a consumer financial product or service, or the offering of a consumer financial product or service, to be unlawful on the grounds that such act or practice is unfair, unless the Bureau has a reasonable basis to conclude that— (A) the act or practice causes or is likely to cause substantial injury to consumers which is not reasonably avoidable by consumers; and (B) such substantial injury is not outweighed by countervailing benefits to consumers or to competition. (2) Consideration of public policies In determining whether an act or practice is unfair, the Bureau may consider established public policies as evidence to be considered with all other evidence. Such public policy considerations may not serve as a primary basis for such determination. (d) Abusive The Bureau shall have no authority under this section to declare an act or practice abusive in connection with the provision of a consumer financial product or service, unless the act or practice— (1) materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service; or (2) takes unreasonable advantage of— (A) a lack of understanding on the part of the consumer of the material risks, costs, or conditions of the product or service; (B) the inability of the consumer to protect the interests of the consumer in selecting or using a consumer financial product or service; or (C) the reasonable reliance by the consumer on a covered person to act in the interests of the consumer. (e) Consultation In prescribing rules under this section, the Bureau shall consult with the Federal banking agencies, or other Federal agencies, as appropriate, concerning the consistency of the proposed rule with prudential, market, or systemic objectives administered by such agencies. (f) Consideration of seasonal income The rules of the Bureau under this section shall provide, with respect to an extension of credit secured by residential real estate or a dwelling, if documented income of the borrower, including income from a small business, is a repayment source for an extension of credit secured by residential real estate or a dwelling, the creditor may consider the seasonality and irregularity of such income in the underwriting of and scheduling of payments for such credit.

    11 other bills also change this section · Follow it → Official text at uscode.house.gov ↗

  • § 5565 Relief available Amends

    12 U.S.C. § 5565 — at 5565(c)

    The law today

    (a) Administrative proceedings or court actions (1) Jurisdiction The court (or the Bureau, as the case may be) in an action or adjudication proceeding brought under Federal consumer financial law, shall have jurisdiction to grant any appropriate legal or equitable relief with respect to a violation of Federal consumer financial law, including a violation of a rule or order prescribed under a Federal consumer financial law. (2) Relief Relief under this section may include, without limitation— (A) rescission or reformation of contracts; (B) refund of moneys or return of real property; (C) restitution; (D) disgorgement or compensation for unjust enrichment; (E) payment of damages or other monetary relief; (F) public notification regarding the violation, including the costs of notification; (G) limits on the activities or functions of the person; and (H) civil money penalties, as set forth more fully in subsection (c). (3) No exemplary or punitive damages Nothing in this subsection shall be construed as authorizing the imposition of exemplary or punitive damages. (b) Recovery of costs In any action brought by the Bureau, a State attorney general, or any State regulator to enforce any Federal consumer financial law, the Bureau, the State attorney general, or the State regulator may recover its costs in connection with prosecuting such action if the Bureau, the State attorney general, or the State regulator is the prevailing party in the action. (c) Civil money penalty in court and administrative actions (1) In general Any person that violates, through any act or omission, any provision of Federal consumer financial law shall forfeit and pay a civil penalty pursuant to this subsection. (2) Penalty amounts (A) First tier For any violation of a law, rule, or final order or condition imposed in writing by the Bureau, a civil penalty may not exceed $5,000 for each day during which such violation or failure to pay continues. (B) Second tier Notwithstanding paragraph (A), for any person that recklessly engages in a violation of a Federal consumer financial law, a civil penalty may not exceed $25,000 for each day during which such violation continues. (C) Third tier Notwithstanding subparagraphs (A) and (B), for any person that knowingly violates a Federal consumer financial law, a civil penalty may not exceed $1,000,000 for each day during which such violation continues. (3) Mitigating factors In determining the amount of any penalty assessed under paragraph (2), the Bureau or the court shall take into account the appropriateness of the penalty with respect to— (A) the size of financial resources and good faith of the person charged; (B) the gravity of the violation or failure to pay; (C) the severity of the risks to or losses of the consumer, which may take into account the number of products or services sold or provided; (D) the history of previous violations; and (E) such other matters as justice may require. (4) Authority to modify or remit penalty The Bureau may compromise, modify, or remit any penalty which may be assessed or had already been assessed under paragraph (2). The amount of such penalty, when finally determined, shall be exclusive of any sums owed by the person to the United States in connection with the costs of the proceeding, and may be deducted from any sums owing by the United States to the person charged. (5) Notice and hearing No civil penalty may be assessed under this subsection with respect to a violation of any Federal consumer financial law, unless— (A) the Bureau gives notice and an opportunity for a hearing to the person accused of the violation; or (B) the appropriate court has ordered such assessment and entered judgment in favor of the Bureau.

    2 other bills also change this section · Follow it → Official text at uscode.house.gov ↗

How this bill changes current law

6 changes Share ↗

Compared against current U.S. Code AI-generated reading aid — verify against the official bill.

The bill amends the Consumer Financial Protection Act of 2010 to clarify standards for enforcement actions regarding unfair, deceptive, or abusive acts and practices, and adds provisions related to civil penalties, notice and opportunity to cure, and examination period limitations.

  • 12 U.S.C. 5565(c)

    (6) Rulemaking.--The Bureau shall, not later than 180 days after the date of the enactment of this paragraph, issue a rule that establishes policies and procedures relating to the imposition of civil monetary penalties sought under this subsection, including the application of the mitigating factors described in paragraph (3).

    Requires the Bureau to issue a rule for assessing civil monetary penalties within 180 days.

  • 12 U.S.C. 5531(b)

    (b) → (b) Rulemaking.--(1) In general.--The Bureau may prescribe rules applicable to a covered person or service provider identifying as unlawful unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a consumer financial product or service, or the offering of a consumer financial product or service. Rules under this section may include requirements for the purpose of preventing such acts or practices. (2) Cost benefit analysis required.--Any final rule issued by the Bureau relating to abusive, unfair, or deceptive acts or practices shall include a cost-benefit analysis. (3) Definition of abusive act or practice.--The Bureau shall, not later than 180 days after the date of the enactment of this subsection, issue a rule that defines the term `abusive act or practice' for the purposes of this section.

    Replaces the existing subsection with new provisions for rulemaking, requiring a cost-benefit analysis and a definition of abusive acts.

  • 12 U.S.C. 5531

    (g) Notice and Opportunity To Cure.--(1) In general.--If a covered person self-identifies a potential unfair, deceptive, or abusive act or practice carried out by such covered person, the Bureau shall, not later than 90 days after such self-identification, provide a written notice...before the Bureau may pursue other legal action. (2) Tolling of statute of limitations.--Any applicable statute of limitations that applies to conduct under which the Bureau has given notice and an opportunity to cure shall not toll until--(A) the covered person cures the potential abusive, unfair, or deceptive act or practice and notifies the Bureau...180-day period to cure ends.

    Introduces a process for self-identifying covered persons to receive notice and an opportunity to remedy potential violations before enforcement action is taken.

  • 12 U.S.C. 5531(d)

    (d) → (d) Abusive.--(1) In general.--The Bureau shall have no authority to declare an act or practice of a covered person abusive...considered abusive if--(C) the conduct is otherwise prohibited by Federal consumer financial law.

    Clarifies the criteria under which an act or practice can be deemed abusive, introducing several specific conditions.

  • 12 U.S.C. 5561

    SEC. 1059. UNFAIR, DECEPTIVE, OR ABUSIVE ACTS OR PRACTICES ENFORCEMENT ACTIONS. Enforcement actions brought by the Bureau under section 1031 under this title shall be brought in--(1) the United States district court located where the covered person has its headquarters location; or (2) the United States District Court for the District of Columbia.

    Establishes specific judicial venues for enforcement actions regarding unfair, deceptive, or abusive acts.

  • 12 U.S.C. 5561

    (g) Enforcement Actions.--(1) In general.--If the Bureau brings an enforcement action under this section, the Bureau shall state with particularity the circumstances that the Bureau alleges constitute a violation of this section.

    Mandates specificity in the Bureau's enforcement actions regarding alleged violations.

Action History

  1. Introduced in House

  2. Introduced in House

  3. Referred to the House Committee on Financial Services.

Sponsors

Sponsorship breakdown

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1 sponsors · 0 co-sponsors · 546 not signed on

Sponsors (1)

Co-sponsors (0)

None.

Not signed on (546)

546 members have not signed on to this bill.

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"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Subjects

finance
Cross-referencing the record. Reading this bill against every other bill in the corpus by meaning, not keywords. Only the first open is slow. It’s instant for you after this. Matching · Ranking · Engrossing

Frequently asked questions

What does HR 6789 do?
To amend the Consumer Financial Protection Act of 2010 to clarify standards for UDAAP enforcement actions brought by the Bureau of Consumer Financial Protection, and for other purposes.
Who sponsors HR 6789?
HR 6789 is sponsored by Barr, Andy (Republican).
What is the current status of HR 6789?
This bill died with 118th Congress. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
Where can I track HR 6789?
Track HR 6789 free on One Click Politics — get push/email alerts when it moves.

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