Pearson Quoted in Law360 on CFPB’s Concern Around Credit Card Reward Programs

CFPB’s Chopra Trains Sights on Credit Card Rewards
– Law360

Manatt Consumer Financial Services Leader Scott Pearson was quoted in Law360 on the Consumer Financial Protection Bureau’s (CFPB) scrutiny of rewards program practices in the credit card industry.  

The article addresses comments from CFPB Director Rohit Chopra that the agency will be focusing in on “concerning patterns” in credit card rewards program practices, such as allegedly “quiet” changes to program benefits and rewards point values. Pearson contended that these problems are exaggerated and that reward programs are not in need of stricter rules. He argued that the sample size of the analysis of customer complaints backing the CFPB’s allegations was far too small to support a finding of endemic problems. According to Pearson, “this is an incredibly competitive market,” which allows consumers to pick from a variety of reward options with valuable benefits, leading to the vast majority of consumers being “very happy.” The CFPB's report, by contrast, is “bad science,” Pearson said. “It's really unfortunate because, at the end of the day, the bureau is raising costs for consumers by stirring up issues that don't exist.”  

Read the full Law360 article here



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