CFPB Seeks Input on Digital Payment Privacy

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CFPB Seeks Input on Digital Payment Privacy

The Consumer Financial Protection Bureau (CFPB) proposed new guidance on Friday to clarify that cryptocurrency transactions, video game economies, and other emerging payment technologies are subject to federal rules protecting consumers from fraudulent transfers, hacks, and stolen funds. The move seeks to expand the application of the Electronic Fund Transfer Act (EFTA) and Regulation E to align with innovations in digital payments.

Expanding Consumer Protections to Emerging Payments

The CFPB’s proposed interpretive rule broadens the scope of “funds” covered under EFTA, extending protections to include stablecoins, cryptocurrencies, in-game currencies, and even stock used for retail purchases. It clarifies that consumers’ rights to dispute unauthorized transactions apply to accounts beyond traditional savings or checking accounts, such as:

  • Crypto wallets used for payments.
  • Video game accounts used to buy virtual goods.
  • Reward points accounts tied to credit cards for future purchases.

“These interpretations of ‘funds’ accord with Congress’s intent by ensuring consumers are protected and can benefit from innovative electronic fund transfer systems,” the CFPB stated.

Gaming Economies and Consumer Recourse

A CFPB blog accompanying the proposal highlighted the risks in evolving in-game economies, noting that many gamers face scams, theft, and fraud with little help from operators. The agency invited gamers to share their experiences with in-game transactions, virtual currency, and safeguards they believe are necessary.