Your Third Parties - Potential UDAAP Risk

Podcast Transcript

Hi – my name is Josh with Venminder. 

In this 90-second podcast, you’re going to learn about UDAAP and how it relates to your third party risk.

At Venminder, we help our clients incorporate UDAAP expectations into their program as they monitor their vendors on an ongoing basis.

First…what is UDAAP? UDAAP stands for unfair, deceptive or abusive acts or practices and is designed to help protect your customers.

If you’re overlooking customer or third party complaints, it might lead to a UDAAP violation or a negative reputation. 

Here are 5 recommendations that we have to effectively manage UDAAP and your third parties:

1. First, look at enforcement actions at similar organizations to see if you can learn from their mistakes.
   
   
2. Next, create a complaint management policy. Be sure to also review complaints and have an action plan in place.
   
   
3. Third, develop a set of rules that your lines of business and third parties must follow closely when using additional products and services, particularly those that involve additional fees, intricate disclosures or may be perceived as confusing or difficult to cancel.
   
   
4. Fourth, you should be verifying that your third parties understand your UDAAP expectations. You could write into the contract that you must approve of any new marketing materials or consumer facing disclosures.
   
   
5. Finally, we’d even encourage you to conduct ongoing monitoring.

If you understand and monitor UDAAP properly, you’ll ensure customer satisfaction, help achieve expense reductions, improve staff alignment and reduce your organization’s reputation risk.

Thanks for tuning in; catch you next time!