“Big Tech” Put on Notice for Potential Consumer Protection Violations

Google, Meta may be violating equal credit laws with their marketing

Andy Spears

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Photo by Luke Chesser on Unsplash

Jason Mikula at Fintech Business Weekly reports on the Consumer Financial Protection Bureau’s (CFPB) notice to Big Tech companies about potential liability under various consumer protection laws.

The CFPB has put “Big Tech” on notice that they may be considered service providers to financial services companies that use their advertising platforms and thus “can be held liable by the CFPB or other law enforcers for committing unfair, deceptive, or abusive acts or practices as well as other consumer financial protection violations.”

The agency argues that targeting and optimization algorithms common in digital marketing constitute a material service to financial advertisers (emphasis added):

“Digital marketing providers are typically materially involved in the development of content strategy when they identify or select prospective customers or select or place content in order to encourage consumer engagement with advertising.

Digital marketers engaged in this type of ad targeting and delivery are not merely providing ad space and time, and they do not qualify under the ‘time or space’ exception.”

What does this mean in practice? While the CFPB doesn’t name specific ad platforms in the interpretative rule nor in its statement, it’s pretty clearly targeted at Google and Meta (Facebook).

While the statement about the interpretive rule is broad, referencing potential liability for unfair, deceptive, and abusive practices, the most obvious area that could receive scrutiny is how ad platforms ensure compliance with ECOA or other kinds of unfair discrimination.

Mikula notes that CFPB Director Rohit Chopra gave a speech on the issue and seems rather serious about protecting consumers from abuses by Big Tech firms.

Chopra said:

“Today, relationship banking is under threat. In part, this is because our sensitive data is viewed as more valuable to firms than our actual selves. Advances in technology should help our economy and society advance, rather than incentivizing a rush to seize our sensitive financial data and to allow tech giants to evade existing laws that other firms must comply with. It is critical that we all work together to address this.”

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Andy Spears

Writer and policy advocate living in Nashville, TN —Public Policy Ph.D. — writes on education policy, consumer affairs, and more . . .