THIS CONTENT REFLECTS THE PHILOSOPHY OF BOYLEDOWN LENDING INC., A CONSUMER FINANCE COMPANY LICENSED BY THE VIRGINIA STATE CORPORATION COMMISSION (LICENSE number CFI-256). IT IS INTENDED AS INFORMATIONAL CONTENT AND PROMOTES OUR LENDING MODEL. AS SUCH, IT IS CONSIDERED AN ADVERTISEMENT.

AI Disclosure:
This article was developed with the assistance of artificial intelligence (AI) using OpenAI’s ChatGPT. While the ideas and editorial direction reflect the author’s perspective, portions of the research, structuring, and drafting were supported by AI-generated insights. All content was reviewed and finalized by the author.

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There are three different potential claims under unfair and deceptive practices law. Each one of them – unfairness, deception and abusiveness- have their own legal standards. While a fact pattern can fit under all, some, and obviously none of these causes of action, the elements to satisfy each of these three claims are different.

These elements also derive from different places. Unfairness, for example, is a statutory concept, meaning the elements to satisfy an unfairness claim is literally in the statute. Deception is a little different, as it comes out of regulatory policy statements and then from case law that adopted those statements.

The abusiveness standard is statutory, like unfairness — not just a policy statement.

It comes directly from the Dodd–Frank Act (Section 1031(d), codified at 12 U.S.C. § 5531(d)). Congress defined abusiveness in two alternative prongs, either of which can be met to satisfy an abusiveness claim:

Materially interferes with a consumer’s ability to understand a term or condition of a consumer financial product or service; or

Takes unreasonable advantage of a consumer’s:

• Lack of understanding of the risks, costs, or conditions;
• Inability to protect their interests;
• Reasonable reliance on a provider to act in their interests.

Understand though that the “abusive” claim is not universal. It only exists for entities subject to Dodd–Frank’s UDAAP authority (12 U.S.C. § 5531(d)), which applies to:

• “Covered persons” and “service providers” in the consumer financial products or services space, and
• Entities under the supervisory or enforcement jurisdiction of the CFPB or other Dodd–Frank–empowered agencies such as the FDIC and the OCC.

If you’re outside that jurisdiction — for example:

• Non-financial goods or services regulated by the FTC under Section 5 of the FTC Act (15 U.S.C. § 45)
• State UDAP statutes modeled on FTC Act § 5
  — then the available unfair/deceptive standards are only unfairness and deception.¹

In other words:

• FTC Act jurisdiction → Unfairness + Deception.
• Dodd–Frank jurisdiction → Unfairness + Deception + Abusiveness.

The Mnemonic for Deception

To stay mentally organized between these interrelated concepts, it can be useful to employ a mnemonic device. The one I came up with is this:

Deploy robots on puffy low-maintenance mushrooms… A mnemonic device for detecting deception under UDAP UDAAP:

“Deception [is] representation, omission, practice likely misleading materially.”

Here’s the more formal definition and elements for valid deceptive practices claim under UDAP/UDAAP law.

“A representation, omission, or practice is deceptive if it is likely to mislead consumers acting reasonably under the circumstances, and is material—that is, if it is likely to affect the consumer’s conduct or decision with regard to a product or service.”

That single sentence is the foundation for the three-element deceptive acts test:

1) Representation, omission, or practice.
2) Likely to mislead reasonable consumers.
3) Materiality.

FTC Policy Statement on Deception, Cliffdale Associates, Inc., 103 F.T.C. 110, 174–184 (1984).

Why Does It Matter for a Consumer to Know the Deception Elements?

Understanding the key elements of deceptive practices helps consumers better recognize when they might be misled by a product or service. By knowing what constitutes a representation, omission, or practice likely to mislead reasonable consumers—and that the misleading act must be material—individuals can make more informed decisions and avoid potential harm.

While consumers generally do not have private rights to enforce federal UDAAP or UDAP laws themselves, their awareness can encourage them to report deceptive behavior to regulators like the FDIC, CFPB, Federal Reserve, OCC, or state attorneys general who do. This in turn helps authorities take action to protect the broader public. At the same time, consumers often do have standing to bring private causes of action under state deceptive trade practices laws, allowing them to seek remedies directly for harm suffered. This knowledge promotes market transparency and helps create pressure for fair and honest business practices.

Disclaimer: This blog post is for informational purposes only and is not intended to provide legal, financial, or tax advice. You should consult your own attorney, financial advisor, or tax professional regarding your individual situation and any legal obligations applicable to your business or personal finances.

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Email: doboyled@gmail.com
Phone: (631) 379‑0306
Mailing Address:
Boyledown Lending Inc.
285 Crockett Hill Lane
Cross Junction, VA 22625

1. States That Include “Abusive” in Their Statutes
   Maryland: Amended its Maryland Consumer Protection Act (MCPA) to explicitly prohibit “unfair, abusive, or deceptive trade practices”. ↩︎