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Protection Acts in Financial Regulations that You Should be Educated On

Consumers are protected from exploitation by the government through the consumer protection laws in its financial regulations. There are exceptions to every consumer protection act in financial regulations. 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. 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.

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 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 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. 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. This law governs 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 act examines issues that are related to consumer credit contracts with lenders such as department stores, car dealers, and financing companies. The law takes care of houseboats and mobile homes although it excludes bank loans, contracts with loan associations, or real estate purchases.

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