The U.S. Consumer Financial Protection Bureau (CFPB) is considering using the Electronic Fund Transfer Act (EFTA) to safeguard consumers from fraudulent crypto transactions
The EFTA, established in 1978, shields consumers during electronic fund transfers, covering debit cards, ATMs, and bank accounts. It aims to limit consumer losses from unauthorized transfers
The CFPB intends to provide guidance on how existing electronic fund transfer laws apply to crypto. This will include informing consumers about their liability for unauthorized transfers before their first electronic transfer takes place
This move follows a surge of over 150% year-on-year in crypto-platform hacks and the ongoing criminal trial of FTX co-founder Sam Bankman-Fried, accused of fraudulently accessing and using customer funds
The CFPB will also issue orders to "certain large technology firms" to gather information on their data practices and private currency issuance. They'll also examine non-bank payment platforms
Chopra suggested that the Treasury's Financial Stability Oversight Council classify some crypto activities as "systemically important payment clearing or settlement activities," potentially adding critical oversight to ensure stablecoins are genuinely stable