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Consumers are protected from exploitation by the government through the consumer protection laws in its financial regulations. The consumer protection acts in financial regulations are limited by the exceptions. Here is a discussion on some of the essential consumer protection acts in financial regulations.
The consumers and their financial records are protected from abuse by the consumer credit protection act that was moved by the Congress in 1968. There have been other laws after this act was introduced that define the process that the government should follow when accessing information from the bank about a customer, ways a bank should relate with its borrowers and handle deposits of customers. 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.
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 Congress moved this act to protect the confidentiality of personal financial records after the 1978 judgment in the Supreme Court of the United States v. Miller stated that the records of the consumer of a bank are not subject to constitutional privacy protection.
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 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. This law takes care of partnerships of five or less than five members and individuals but not 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.
Consumers in debt are protected by the credit practices rule that was embraced by Federal Reserve Board in 1985. The act deals with consumer credit contracts with creditors such as department stores, car dealers, and financing companies. The act is concerned with houseboats and mobile homes but not bank loans, agreements with loan associations, or real estate purchases.