Category Archives: Unfair & Deceptive Acts & Practices (UDAP), including Discrimination

Paper on the FTC’s power to regulate discriminatory AI

Andrew D. Selbst of UCLA and Solon Barocas of Microsoft Research and Cornell have written Unfair Artificial Intelligence: How FTC Intervention Can Overcome the Limitations of Discrimination Law, 171 University of Pennsylvania Law Review __ (forthcoming). Here is the abstract: The Federal Trade Commission has indicated that it intends to regulate discriminatory AI products and services. […]

Unfairness and Disparate Effects

by Jeff Sovern As we wrote about in May, the CFPB takes the position that it can use its unfairness power when consumer financial service companies discriminate. One issue that has arisen is whether when it does so, the Bureau will use the disparate effects test, sometimes called the disparate impact test, to determine if […]

Some comments on Alan Kaplinsky’s comments on my comments

by Jeff Sovern I am grateful to Alan Kaplinsky for commenting on two of my earlier posts, Whither Arbitration Regulation? and Why the CFPB is right that it can act against discrimination using its unfairness power. One of Alan’s posts is titled Why the CFPB’s expansion of its UDAAP authority to target discrimination requires rulemaking. In the other […]

Why the CFPB is right that it can act against discrimination using its unfairness power

by Jeff Sovern Recently the CFPB announced that in conducting supervisory operations, it takes the position that discrimination is unfair and so violates the Consumer Financial Protection Act. You might think this is pretty straightforward: most of us would think odious discrimination is unfair. Discrimination easily qualifies as unfair under the statutory requirements of unfairness, […]

Are we going to see UDAAP statutes used against discrimination? The Student Borower Protection Center hopes so

The SBPC issued a report, DISCRIMINATION IS "UNFAIR": Interpreting UDA(A)P to Prohibit Discrimination. Here's the Executive Summary: This Article explores a theory that discrimination is a type of “unfair” practice covered by federal and state laws prohibiting unfair, deceptive (and sometimes abusive) acts and practices (“UDA(A)Ps”). An “unfair” practice is defined by statute as something […]

CFPB rescinds disappointing abusiveness policy statement

by Jeff Sovern Last year we blogged about the CFPB's disappointing abusiveness policy statement. But things are different this year and the Bureau has wisely rescinded the Policy Statement, saying that it "was inconsistent with the Bureau’s duty to enforce Congress’s standard and rescinding it will better serve the CFPB’s objective to protect consumers from […]

Becher, Feldman and Furth paper on the problem of salespeople’s oral promises that are disclaimed in the fine print

Shmuel I. Becher of Victoria University of Wellington, Yuval Feldman of Bar-Ilan University, and Meirav Furth of UCLA have written Seductive Oral Deals. Here's the abstract: Legal scholars have devoted considerable attention to contractual design that exploits consumers’ vulnerabilities (“the paper deal”). For example, scholars have cautioned against the inclusion of one-sided, exploitative, or unenforceable […]