Rectifying UDAAP Act
Sponsored By: Representative Barr
Introduced
Summary
This bill would narrow and clarify the Consumer Financial Protection Bureau's authority to enforce unfair, deceptive, or abusive acts or practices (UDAAP). It would set clearer legal tests and add procedural limits on when and how the CFPB could impose penalties or seek relief.
Show full summary
- Consumers and families: The bill would tighten the definition of "abusive" so a practice must either intentionally and materially block a consumer's understanding of a term or unreasonably exploit a consumer's lack of understanding and reliance. It also ties findings of injury to avoidability and net benefits.
- Financial firms and covered persons: It would create a notice-and-cure process where firms that self-identify potential UDAAP get a notice within 90 days and 180 days to cure. The bill would also require good-faith compliance before monetary penalties and bar civil penalties for conduct before a firm's most recent consumer compliance rating.
- Rulemaking and enforcement: The CFPB would have to define "abusive" and issue rulemaking within 180 days, include a cost-benefit analysis for final rules, and solicit public comment. The bill would also limit where enforcement suits can be filed and require particularized allegations in UDAAP claims.
- Scope limits: The bill would prohibit the CFPB from interpreting its UDAAP authority to cover discriminatory practices.
Your PRIA Score
Personalized for You
How does this bill affect your finances?
Sign up for a PRIA Policy Scan to see your personalized alignment score for this bill and every other piece of legislation we track. We analyze your financial profile against policy provisions to show you exactly what matters to your wallet.
Bill Overview
Analyzed Economic Effects
3 provisions identified: 0 benefits, 0 costs, 3 mixed.
Consumer finance rules need cost-benefit test
The bill would let the consumer finance bureau write rules that identify unfair, deceptive, or abusive acts. The rules could include steps firms must take to prevent these acts. Any final rule would need a cost-benefit analysis. These authorities would start upon enactment if the bill becomes law.
Limits on consumer finance penalty powers
This bill would add guardrails to how the consumer finance bureau enforces UDAAP. If a firm self-reports a problem, the Bureau must send notice within 90 days, and the firm gets 180 days to cure. The statute of limitations would not pause during that window. The Bureau could not seek money under UDAAP unless the firm fails to prove good-faith compliance. Civil money penalties would be barred for conduct before the firm’s most recent consumer compliance rating, though other relief could still be sought. Within 180 days, the Bureau would set penalty policies and how to weigh mitigating factors. Lawsuits must be filed in the firm’s home district or in D.C., with detailed claims, and claims cannot be pled in the alternative. The Bureau could not read UDAAP to cover discrimination.
Tighter rules for calling acts abusive
This bill would tighten when the consumer finance bureau could label a practice as abusive. A practice would be abusive only if it either intentionally and materially blocks a consumer’s understanding of a term, or takes unreasonable advantage of a consumer’s lack of understanding and reasonable reliance on an affirmative action or statement. It would also require substantial harm that consumers cannot reasonably avoid, or harm not outweighed by benefits to consumers or competition. Harm would be presumed avoidable if the practice was timely, clear, and conspicuous. The Bureau would have to define “abusive act or practice” by rule within 180 days and take public comment on UDAAP confusion within 180 days.
Free Policy Watch
You just read the policy. Now see what it costs you.
Pick a topic. PRIA runs your household against live legislation and sends you a free personalized readout.
Pick a topic to get started
Sponsors & CoSponsors
Sponsor
Barr
KY • R
Cosponsors
Rep. Garbarino, Andrew R. [R-NY-2]
NY • R
Sponsored 6/24/2025
Rep. Wagner, Ann [R-MO-2]
MO • R
Sponsored 6/26/2025
Rep. Meuser, Daniel [R-PA-9]
PA • R
Sponsored 6/26/2025
Rep. De La Cruz, Monica [R-TX-15]
TX • R
Sponsored 6/26/2025
Moore (NC)
NC • R
Sponsored 7/16/2025
Sessions
TX • R
Sponsored 9/16/2025
Rep. Lawler, Michael [R-NY-17]
NY • R
Sponsored 10/6/2025
Roll Call Votes
No roll call votes available for this bill.
View on Congress.govTake It Personal
Get Your Personalized Policy View
Take the PRIA Score to see how policy affects your household, then upgrade to PRIA Full Coverage for year-round monitoring.
Already have an account? Sign in