Federal regulators took a close look at advertisements for consumer financial products and services in 2015, bringing over 25 enforcement actions totaling over $975 million in penalties and consumer redress. In the majority of these actions, regulators evaluated: (1) how advertisements characterize the product being offered, including the nature of the product and the terms and conditions applicable to the advertised features; (2) how well those that offer consumer financial products and services oversee their vendors that advertise directly to consumers, including telemarketers and retailers at the point of sale; and (3) whether advertisements obscure their true source.
In this client alert, we outline the legal standard that regulators use when evaluating whether advertisements are deceptive, and offer our top five lessons learned from 2015 enforcement actions against those that advertise consumer financial products and services.
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