A federal consumer watchdog said Friday it would hold bank and nonbank firms accountable for outside service providers, including those in the mortgage industry.

The Consumer Financial Protection Bureau released the reminder to clarify that companies under its oversight must ensure contracted servicers comply with federal consumer law.

“Consumers are at a real disadvantage because they do not get to choose the service providers they deal with,” CFPB Director Richard Cordray said in a news release. “Banks and nonbanks must manage these relationships carefully and can be held accountable if they break the law.”

The CFPB issued the bulletin partly to signal they will actively watch over these outside providers and pursue legal action against the parent company, where applicable, according to an agency spokeswoman. Bank regulators have frequently advocated for such oversight, but could not do the same for nonbank entities prior to passage of the Dodd-Frank Act.

Mortgage servicers fall under the onus of the CFPB, both as nonbanks and service providers, with a large focus on the industry from the agency.

The CFPB said companies should work to limit harm on customers through careful selection of service providers, as well as review of the providers’ procedures. The agency also recommended firms establish internal controls and continually monitor these providers.