The consumer protection laws in the financial regulations of the government controls and monitors the activities of financial institutions to prevent consumer exploitation. Each consumer protection act in financial regulations is limited by the omissions. Here is a discussion on some of the essential consumer protection acts in financial regulations.
In 1968, the Congress enacted a consumer credit protection act to protect the consumers and their financial records from abuse. More laws have been set later on that clarify how the government should get information from the bank about a customer, how the bank should manage deposits of its customers and the relationship that the bank should have with borrowers. An increase in data theft by cybercriminals, the expansion of underground and legal market for data and growth of data analytics has led to more federal laws to be made to curb the extent of financial history data of another person that one should collect and ways they should use the data.
There are boundaries that the government should not go beyond when accessing your personal financial records because the right to financial privacy act protects you. The 1978 decision in the Supreme Court of the United States v. Miller pronounced that the records of the consumer of a bank are not subject to constitutional privacy protection hence the Congress took it upon itself to protect the confidentiality of personal financial records of the consumer by legislating the right to financial privacy act.
Government officials cannot gain access to personal financial records if they lack a written consent, a search warrant or a subpoena as required by the financial privacy act. The applies to the federal government and its agents, officers, agencies and departments alone but not the local or state governments. The investigators must mail the account holder a notification and wait for response for 10-14 days after the mailing date before they are allowed to start a search that should also be authorized. The act protects partnerships of five or less than five members and individuals and excludes companies and large groups like labor unions and trade associations. The act applies to assortment of institutions like money-order issuers, depository institutions such as banks, the U.S. postal service, securities and futures brokerages, thrifts and credit unions, travelers’ check issuers, commodity trading advisors, casinos and card clubs.
Credit practices rule was implemented by Federal Reserve Board in 1985 to protect the rights of consumers who have debts. The law focuses on consumer credit contracts with creditors such as department stores, car dealers, and financing institutions. It does not take into consideration the bank loans, contracts with loan associations, or real estate purchases but it covers houseboats and mobile homes.
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