Digital marketing firms that help financial companies design and place online ad campaigns are service providers for the purpose of the Consumer Financial Protection Act of 2010, the Consumer Financial Protection Bureau said in a new interpretive ruling.

As such, they are subject to CFPB enforcement for unfair, deceptive or abusive conduct.

“When Big Tech firms use sophisticated behavioral targeting techniques to market financial products, they must adhere to federal consumer financial protection laws,” CFPB Director Rohit Chopra said in a statement. “When you commingle the targeting and delivery of ads to consumers, such as by using algorithmic models or other analytics, with the provision of advertising “time and space” you are no longer exempted from the provisions of the financial consumer finance laws.”

Traditional marketing firms have been exempted from restrictions on unfair, deceptive and abusive acts and practices and other federal consumer finance laws enforced by the CFPB under the “time or space” exception (the purchase of ad space on popular radio or television shows and print publications, without engaging in more technically advanced activities).

Digital marketing firms are different, the CFPB said.

Per a CFPB interpretive rule:

Digital marketing firms will be held accountable for false statements if they were involved in crafting marketing campaigns and strategy that contain them.

This is because:

  • Digital marketers are much more heavily involved than their traditional counterparts in targeting advertisements at specific demographic groups and where the ads are placed.
  • When digital marketing providers are materially involved in the development of content strategy, they typically provide a material service.
  • When digital marketers are materially involved in the development of content strategy in addition to providing airtime or physical space, they fall outside the exception for “solely” providing “time or space.”
  • Digital marketing providers do not fall within the “time or space” exception if they target and deliver advertisements to users with certain characteristics, even if those characteristics are specified by the covered person.
  • Similarly, digital marketing providers do not fall into the “time or space” exception if a covered person identifies particular users by name and the digital marketer targets and delivers the advertisements to those users at specific times to increase or maximize engagement.