In a Nov. 23 alert, the CFPB reminded companies they must obtain authorization before automatically debiting a consumer's account.
Additionally, the CFPB reminded companies they are required by law to provide notifications to consumers that clearly describe the terms of preauthorized automatic debits. Further, the agency said it published action letters that consumers may use to revoke a company's authorization to automatically debit their accounts.
"This bulletin makes clear that companies must get a consumer's authorization before automatically debiting their account," CFPB Director Richard Cordray said. "Consumers also have the right to stop these charges at any time. They can use our action letters or submit a complaint to the bureau if they are having problems managing or stopping auto debits."
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