Which of the following is an important implication of the Dodd-Frank Wall Street Reform and Consumer Protection Act?
Which of the following is an important implication of the Dodd-Frank Wall Street Reform and Consumer Protection Act?
The Dodd-Frank Wall Street Reform and Consumer Protection Act is aimed at promoting financial stability and protecting consumers. One of its key implications is ensuring that consumers have a clear understanding of financial products and services to prevent abusive practices. This means financial institutions must help ensure a customer's understanding of products and services, aligning with the objective of preventing practices that interfere with or exploit consumer understanding.
Dodd-Frank Wall Street Reform and Consumer Protection Act Abusive practices are defined by Dodd–Frank and enforceable by the CFPB. An abusive practice is any act that “materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service.” Practices are also considered abusive if they exploit consumer misunderstanding, consumers who are unable to understand the terms, or a consumer relying on a third‐party who may be exploiting them.