To help you keep abreast of relevant activities, below is a breakdown of some of the biggest federal and state level events impacting the consumer financial services industry in the past week:
- On October 14, U.S. Representative and Chairman of the Select Subcommittee on the Coronavirus Crisis, James Clyburn, sent a letter to Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra asking the agency to review the nation’s three largest National Consumer Reporting Agencies (NCRA) for possible violations of the Fair Credit Reporting Act (FCRA), including failure to investigate legitimate consumer disputes. This letter follows President Clyburn’s May 2022 letters to NCRA, requesting information on companies’ efforts to respond to and resolve credit report inaccuracies raised by consumers during the pandemic. For more information, click here.
- On October 13, the CFPB released a report on the terms and fees associated with banking products marketed in partnership with colleges to students. The report raises questions about whether some marketing deals between colleges and financial institutions comply with Department of Education rules. Concurrent with the release of this report, the Department of Education issued guidance to schools on requirements for college-sponsored banking arrangements, while committing to additional oversight on this issue. For more information, click here.
- On October 13, the CFPB, the Federal Reserve Board and the Office of the Comptroller of the Currency (OCC) announced that the 2023 threshold for exempting loans from special appraisal requirements for higher priced mortgages will rise. from $28,500 to $31,000. For more information, click here.
- On October 13, the Federal Reserve and the CFPB announced the dollar thresholds used to determine whether certain consumer finance and leasing transactions in 2023 are exempt from Z (truth in lending) and Z regulations. M (consumer leasing). For more information, click here.
- On October 12, Federal Trade Commission Chair Lina Khan and Justice Department Antitrust Deputy Attorney General Jonathan Kanter participated in the Joint G7 Summit of Policy Makers and Competition Policy Officials as part of the “G7 2022 digital and technological track”. Organized by the German Bundeskartellamt and the German Ministry of Economic Affairs and Climate Action, the summit explored how G7 governments approach competition policy and its enforcement in digital markets. Participating delegates included G7 competition authorities and economic ministries from Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, as well as the European Commission . For more information, click here.
- On October 12, Federal Reserve Vice Chairman for Oversight Michael Barr delivered a speech at DC Fintech Week in a speech entitled “Managing the Promise and Risk of Financial Innovation”, which focused on financial innovation supported by new technologies or fintech. For more information, click here.
- On October 12, Coin Center, a nonprofit digital asset advocacy group, filed a lawsuit against the U.S. Department of the Treasury (Treasury) in the U.S. District Court for the Northern District of Florida, arguing that punishments the Treasury imposed on Tornado Cash exceeded its regulatory authority because Tornado Cash, as publicly available open source software, does not constitute a “person” within the meaning of the International Emergency Economic Powers Act (50 USC 1701and following.). For more information, click here.
- On October 11, the CFPB published its 27th edition of Oversight Highlights, which included exam results from student loan managers. For more information, click here.
- On October 11, U.S. Representative Patrick McHenry led Republican members of the FinTech Task Force to send a letter to Acting Comptroller of the Currency Michael Hsu. Republicans on the task force urged Acting Comptroller Hsu to clarify the OCC’s position on partnerships between banks and fintech companies, as well as clarify the market. For more information, click here.
- On October 11, JPMorgan and Visa announced their collaboration to facilitate cross-border payments. JPMorgan’s proprietary blockchain platform, Onyx, primarily used for wholesale payment transactions, has an integrated interbank information network, which JPMorgan has rebranded as Liink. Liink enables user institutions to efficiently and securely transfer payment-related account information without the need for correspondent banking. Confirm, one of Liink’s product stacks, allows user institutions to validate account information before payment is initiated, ensuring that payments will reach the desired end customer. Visa, through its multilateral B2B Connect payment network, will integrate Confirm into its processes to validate cross-border payments facilitated by Visa. For more information about JPMorgan’s Liink, click here. For more information on Visa’s B2B Connect, click here.
- On October 11, the Treasury’s Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) announced settlements for more than $24 million and $29 million, respectively, with Bittrex, Inc. ( Bittrex), a Bellevue-based virtual currency exchange. , WA. This is OFAC’s largest virtual currency enforcement action to date. It also represents the first parallel enforcement actions by FinCEN and OFAC in this space. Investigations by OFAC and FinCEN revealed apparent violations of multiple sanctions programs and willful violations of Bank Secrecy Act requirements for anti-money laundering and suspicious activity reporting . For more information, click here.
- On October 11, the Financial Stability Board (FSB) published a proposed framework for the international regulation of crypto-asset activities. Under the proposed framework, the FSB has addressed a series of questions to the public and will seek comments on the proposed recommendations until December 15. For more information, click on here.
- On October 11, Acting Comptroller of the Currency Michael Hsu delivered an address to DC Fintech Week, where he discussed the importance of identifying and monitoring cryptocurrency risks to protect consumers and the financial system. For more information, click here.
- On October 10, the FSB released the “G20 Roadmap for Improving Cross-Border Payments,” which revolves around five areas: (1) committing to a common public-private sector vision to improve cross-border payments; (2) coordinate regulatory, supervisory and surveillance frameworks; (3) improving existing payment infrastructure and arrangements to meet cross-border payment market requirements; (4) improve data quality and straight through processing by improving data and market practices; and (5) explore the potential role of new payment infrastructure and modalities. For more information, click here.
- On October 6, the CFPB published a blog post on the ability of mortgage borrowers to challenge inaccurate appraisals through the revaluation process. For more information, click here.
- On October 6, the Federal Reserve announced that it would replace its current system for filing bank applications with a new and improved system later this month. The substantive requirements for applications will remain the same in the new system, making the filing process more intuitive and minimizing paper applications and communications. For more information, click here.
- On October 3, FSB Chairman Klaas Knot sent a letter to G20 finance ministers and central bank governors, regarding global financial stability that arose after the release of two FSB reports. The letter feared that the risks that crypto assets pose to financial stability were “likely to come to the fore sooner rather than later.” For more information, click here.
- On October 12, New York Attorney General Letitia James was awarded nearly $2 million by an e-commerce retailer for its failure to properly address a data breach that compromised consumers’ personal information in the whole world. Based on information uncovered during its investigation, the AG’s office determined that the company failed to implement appropriate safeguards to protect consumer data prior to the breach, failed to take action to protect consumer data after the breach and had not accurately communicated the extent of the cyberattack on consumers. In addition to paying the penalties, the company must also strengthen its cybersecurity measures to protect consumer data in the future. For more information, click here.
- On Oct. 12, Maryland Attorney General Brian Frosh warned consumer vehicle buyers to be on high alert for vehicles potentially damaged by large-scale flooding. Frosh warns consumers that following hurricanes like Ian, flood-damaged vehicles typically go to salvage auctions. However, as Frosh warns, these vehicles are not always correctly labeled as “salvage” or “total loss” vehicles when they come to market for consumption. As a result, Frosh gives consumers several tips for identifying flood-damaged vehicles before making a purchase. For more information, click here.