Bitcoin And The Bureau: CFPB Issues Warning, Takes Complaints On Virtual Currencies

Earlier today, the Consumer Financial Protection Bureau ("CFPB") released a consumer advisory outlining certain risks that may be associated with virtual currencies ("Advisory") and announced that the CFPB will begin accepting consumer complaints regarding virtual currencies through its consumer complaint database. The Advisory follows a June 2014 Government Accountability Office report, which noted that the CFPB had not been particularly engaged in consumer-education efforts related to virtual currencies.¹

RISKS ASSOCIATED WITH VIRTUAL CURRENCIES

The CFPB explains in the Advisory that consumers should be aware of certain risks associated with virtual currencies, including that such currencies: (1) are a target for hackers; (2) do not have liability limitations similar to those of debit cards or credit cards; (3) may have transactional costs that are not associated with other payment methods; and (4) have resulted in new scams by fraudsters who are seeking to