Protection Acts in Financial Regulations that You Should be Educated On
The consumer protection laws in the financial regulations of the government controls and monitors the activities of financial institutions to prevent consumer exploitation. The consumer protection acts in financial regulations are limited by the exceptions. Here are some of the consumer protection acts in financial regulations that you should know.
The 1968 consumer credit protection act was passed by Congress to protect consumers and their financial records from being abused. 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. The government has been forced to formulate more laws that control the limit that one should gather data about the financial history of another person and things they should do and not do with the data because data theft by cybercriminals, underground and legal market for data and data analytics is growing rapidly.
The financial privacy act was passed in 1978 by Congress to restrict the extent to which the government can access your personal financial records. The verdict in the Supreme Court of the United States v. Miller in 1978 declared that the records of the consumer of a bank are not subject to constitutional privacy protection; thus the Congress reacted to this ruling by passing the right to financial privacy act to protect the confidentiality of personal financial records.
Without written consent, a search warrant or a subpoena, government officials should be denied access to personal financial records. The law guides the federal government and its agents, officers, agencies only and departments excludes 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. Companies and large groups like labor unions and trade associations are not included in this law for it only protects partnerships of five or less than five members and individuals alone. This law governs a group 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.
Federal Reserve Board in 1985 adopted the credit practices rule to protect the consumers who were in debt. The law focuses on consumer credit contracts with creditors such as department stores, car dealers, and financing institutions. The law takes care of houseboats and mobile homes although it excludes bank loans, contracts with loan associations, or real estate purchases.