Limited Applicability of Consumer Financial Protection Act's “Time or Space” Exception With Respect to Digital Marketing Providers

• Authority: Consumer Financial Protection Bureau
• Parent authority: Federal government
• Jurisdiction: United States
• Collections: U.S. regulations, executive orders, and agency policies
• Most recent activity: Enacted
• Most recent activity date: 2022-08-17

Risk subdomain coverage

Minimal coverage — Brief mention but no specific mitigations, recommendations or governance measures relating to the risk subdomain are described.

• Unfair discrimination and misrepresentation
• Compromise of privacy
• Fraud, scams, and targeted manipulation

All other risk subdomains had no coverage in this document.

Risk Coverage Summary

The document has minimal coverage of AI risk domains, with brief mentions of discrimination (1.1), privacy (2.1), and malicious actors (4.3). The primary focus is on legal interpretation of service provider definitions rather than AI-specific risks. Coverage is limited to 2-3 subdomains with minimal detail.

Sector coverage

Good coverage — Comprehensive governance measures or mitigations with clear procedures relating to the sector are explicitly described.

• Information
• Finance & Insurance

Minimal coverage — Brief mention but no specific mitigations, recommendations or governance measures relating to the sector are described.

• Professional & Technical Services

All other sectors had no coverage in this document.

Sectors Summary

The document primarily governs the Finance and Insurance sector by clarifying regulatory obligations for digital marketing providers serving financial services companies. It also has significant coverage of the Information sector, as it regulates digital marketing providers (technology companies) that provide algorithmic advertising services.

Legislative Status

Hard Law

Legislative Status Summary

This is an interpretive rule issued by the Consumer Financial Protection Bureau under statutory authority (CFPA) that clarifies binding legal obligations for digital marketing providers. The document interprets existing hard law provisions regarding service provider definitions and UDAAP prohibitions, with enforcement authority vested in the CFPB.

Actors

Proposer

• Entity Types: AI_Governance_Actor
• Summary: The CFPB issued this interpretive rule under its statutory authority to interpret the Consumer Financial Protection Act. The document explicitly states it is issued under the Bureau's authority under section 1022(b)(1) of the CFPA.

Target

• Entity Types: AI_Developer, AI_Deployer
• Summary: The document explicitly targets digital marketing providers that are materially involved in content strategy through algorithmic targeting and delivery. It also applies to financial services companies (covered persons) who use these services.

Enforcer

• Entity Types: AI_Governance_Actor
• Summary: The CFPB has enforcement authority over service providers under the CFPA, including the power to enforce UDAAP prohibitions. The document clarifies which digital marketing providers fall under this enforcement jurisdiction.

Monitor

• Entity Types: AI_Governance_Actor
• Summary: The CFPB monitors compliance with the CFPA and its interpretations. The document references oversight mechanisms and reporting requirements under the Congressional Review Act.

AI Lifecycle Stages

Lifecycle stages covered by the documents, as defined in the OECD Framework for the Classification of AI Systems

• Collect and Process Data
• Build and Use Model
• Deploy
• Operate and Monitor

AI Lifecycle Summary

The document primarily addresses the Deploy and Operate and Monitor stages of the AI lifecycle, focusing on how digital marketing providers use algorithmic models and analytics in production environments to target and deliver advertisements. There is minimal coverage of earlier lifecycle stages.

Technical Scope

Terms relating to technical scope that are mentioned or implicitly referenced in the document

• AI Models
• AI Systems
• Predictive AI
• Task-specific AI

Technical Scope Summary

The document explicitly mentions AI models (machine learning models) and algorithmic analytics used by digital marketing providers. It does not specifically reference frontier AI, general purpose AI, foundation models, or compute thresholds. The focus is on predictive/analytical AI systems rather than generative AI.