Lenders must comply with disclosures required by the federal Truth in Lending Act (TILA) and are subject to other state laws that generally prohibit misleading advertising, protect against discriminatory lending practices, and proscribe unfair credit practices. As of July 2011, companies in the financial services industry including the payday advance industry became regulated by the federal Consumer Financial Protection Bureau (CFPB).
The Truth in Lending Act (TILA)
TILA requires disclosure of the “finance charge” and the “APR” — and certain other costs and terms of credit — so that a consumer can compare the prices of credit from different sources. It also limits liability on lost or stolen credit cards.
The Fair Credit Billing Act (FCBA)
FCBA, part of the TILA, provides other consumer protections if a customer withholds payment while disputing a credit card charge.
Note: No federal law limits your losses from check fraud, but customers are protected under Ohio state law. For example, most state laws hold the bank responsible for losses from a forged check, but they also require the bank customer to take reasonable care of his or her account, including monitoring account statements and promptly reporting an unauthorized transaction to avoid being liable for losses.
Fair Credit and Charge Card Disclosure Act
The Fair Credit and Charge Card Disclosure Act requires new disclosures on credit and charge cards, whether issued by financial institutions, retail stores, or private companies. Information such as APRs, annual fees and grace periods must be provided in tabular form along with applications and preapproved solicitations for cards. The regulations also require card issuers that impose an annual fee to provide disclosures before annual renewal. Card issuers that offer credit insurance must inform customers of any increase in rate or substantial decrease in coverage should the issuer decide to change insurance providers.
Fair Debt Collection Practices Act
The Fair Debt Collection Practices Act is designed to eliminate abusive, deceptive, and unfair debt collection practices. It applies to third party debt collectors or those who use a name other than their own in collecting consumer debts. Very few commercial banks, savings banks, savings and loan associations, or credit unions are covered by this act, since they usually collect only their own debts. Complaints concerning debt collection practices should generally be filed with the FTC or CFPB.