Based on a Law360 article reporting on an interview with Thomas Paul, the Acting Director of the FTC Bureau of Consumer Protection, it appears that under its new leadership, the FTC will take a less aggressive approach to enforcement than the agency had taken under the Obama Administration.  Mr. Paul was appointed Acting Director by Maureen Ohlhausen, who President Trump named Acting Chairman of the FTC.

While Mr. Paul stated that privacy enforcement will continue to be an FTC priority, he indicated that the FTC will not follow the Obama Administration’s approach of labeling certain privacy and data security practices unfair or deceptive in the absence of clear consumer harm.  According to Mr. Paul, the FTC’s enforcement activity will target practices where there is concrete, tangible evidence of consumer injury.

With regard to national advertising, Mr. Paul indicated that the FTC’s enforcement activity will focus on fraud and quasi-fraud and will prioritize matters involving advertising and marketing directed at certain populations such as the military, the elderly, and consumers living in rural areas.  He also indicated that in deciding whether to recommend an enforcement action, FTC staff will look at consumer injury and the costs and benefits of a practice.

With regard to financial practices, Mr. Paul indicated that the FTC’s enforcement activity will target matters involving fraud or quasi-fraud in areas such as debt collection and payday lending, with priority given to matters that are outside of the CFPB’s jurisdiction.  Such matters include claims against auto dealers, claims under the Credit Repair Organizations Act, and claims against companies belonging to industries for which the CFPB has created a “larger participant” rule, such as debt collectors, but that do not qualify as a “larger participant.”  Under the Dodd-Frank Act, the CFPB has authority to supervise, regardless of size, providers of residential mortgage loans and certain related services, payday loans, and private education loans.  Dodd-Frank also gave the CFPB supervisory authority over providers considered to be “a larger participant of a market for other consumer financial products or services.”

Once CFPB Director Cordray departs and is replaced by a successor appointed by President Trump, we would hope and expect that he or she will narrow the CFPB’s enforcement priorities in a manner similar to what Mr. Paul has described for the FTC.