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General Overview

UDAAP is an acronym representing laws that prohibit Unfair, Deceptive, or Abusive Acts or Practices in the context of trade or business. This includes misrepresentation, deception, false advertising, or false promises. These laws emerged following the Dodd-Frank Wall Street Reform and Consumer Protection Act that was enacted in response to the 2008 financial crisis. The ultimate goal with these laws is geared towards protecting consumers involved in financial transactions, educating consumers on their rights, and allowing them access to information and resources to best inform their decisions.

The organizations which regulate and enforce UDAAP laws are the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC). The FTC expanded the initial UDAAP laws in 2004 to include unfair and deceptive acts and practices. Some standards for unfairness, in particular, include if it causes or is likely to cause substantial injury to consumers, the injury is not reasonably avoidable by consumers, and the injury is not outweighed by countervailing benefits to consumers or to competition.

New York

N.Y. Exec. Law Section 63(12) (McKinney) and N.Y. Gen. Bus. Law Sections 349 and 350 (McKinney) are New York’s UDAP statutes. These statutes strongly and broadly prohibit deceptive acts or practices, but only public officials can bring forth claims regarding unfair acts or practices. Even more notably, consumers must show that the deceptive act or practice impacts the public and the claim will benefit all other consumers.

Successful plaintiffs can recover compensatory damages and attorneys fees; multiple or punitive damages are possible too, but the amount has a cap. Elderly plaintiffs can recover an additional civil penalty if elements of proof are available. Plaintiffs must be able to show that a deceptive act or practice was used in the conduct of any business, trade or commerce or in the furnishing of any service in the state. Then, the plaintiff must show that they have been injured by the violation.

UDAAP and Arbitration

Arbitration is an out-of-court proceeding where a neutral third-party (the arbitrator) hears all the evidence from both sides and makes a decision about the case, which may or may not be binding. Binding arbitration, the most common type of arbitration, means that the decision is enforceable in a court of law and participants agree to abide by the decision. Some contracts allow for non-binding arbitration, meaning that either party is free to reject the arbitrator’s decision and take the dispute to court, although this is less common.

Arbitration has many advantages over traditional litigation, including being faster, more flexible in scheduling, and more efficient. Arbitration also avoids the hostility that can accompany court cases, remains confidential, and allows for an arbitrator who is a professional in the field to be selected instead of a judge who may not have familiarity with the issues at hand. 

If you have a UDAAP claim, chances are we can bring your claim in arbitration.  Arbitration is a very useful tool for resolving disputes, and Mike Agruss Law can help. With our expert guidance, we bring the big companies to the table and provide the support needed to get your bills corrected, credit reports fixed, improper fees refunded, and more. Let us pick up the sword for you; you have nothing to lose.

We see you as a person, not just a client – and that makes us better at the work we do. We listen. We learn your story. And, as we help you get the money you deserve, we go above and beyond in a way most law firms never could and never would.  Our unique formula has earned us over 1,070 outstanding client reviews on our website, an A+ BBB rating, and over 155 five-star reviews on Google. Call 888-572-0176, e-mail us at [email protected], or schedule a meeting with us here. We’re here 24/7.

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Submitted Comments

Vladimir
6 months ago
This is my CFPB complain. I was a victim of UDAAP and need an attorney. I was a victim of UDAAP by Discover Home Loans. Initially, I was shopping for HELOC products without running my credit score and checked a few lenders, including Discover Home Loans. When I received the call from the Discover\'s representative Damien Lear NMLS ID #2520396 on 12/05/23, he stated that Discover could do a “no appraisal” loan based on the AVM, which he checked the value as 489k. The representative provided the rate based on the soft credit and then requested that I release my credit, which could be FCRA violation. I was very clear about the fact that I needed to make sure that everything that he was stating was correct, and he said yes, it was. As a result of the promise from the Discover associate, I have released my credit freeze and allowed Discover to run my credit score. The commitment, however, was not fulfilled because I was told after the fact that I needed a “drive-by appraisal,” which I was not told about initially. Furthermore, after the “drive-by” appraisal, I was told that I needed a full appraisal, which could be considered a total “bait and switch” from the initial phone call. I requested from Discover to listen to the phone call at the time of the application but received no response. I am requesting from Discover to make it right for me and provide the loan based on the original agreement. I will get the loan based on the value and 80% CLTV.