Editor's Note
The following newsletter provides a roundup summarizing enforcement actions, guidance, rulemakings, and other public statements taken by a federal and/or state financial services regulatory agency, specifically focusing on: (1) the source of the development (regulator, legislative body, etc.), (2) the subject matter (consumer lending, money transmission, capital markets, etc.), and (3) the general issue covered.
Regulatory Developments
- Federal Reserve Board. Payments & Cryptocurrency. FRB Vice Chair Barr spoke about the agency's role in supporting responsible innovation at its Philadelphia fintech conference including a discussion of FedNow and CBDC.
- Consumer Financial Protection Bureau. Mortgage Lenders. CFPB Director Chopra spoke at a mortgage conference on post-crisis reforms to the mortgage regulatory framework since 2008.
- Consumer Financial Protection Bureau. Commercial Lenders. CFPB published updates to its Small Business Lending Rule FAQs.
- National Credit Union Administration. Credit Unions. NCUA Chair discussed performance data and legislative priorities at a Congressional caucus event.
- Financial Crimes Enforcement Network. Digital Assets & Fraud. FinCEN announced an alert to highlight a prominent virtual currency investment scam known as "pig butchering."
- Illinois Department of Financial and Professional Regulation. Money Transmission & Cryptocurrency. IL DFPR published a non-binding statement in response to a request from a cryptocurrency company, finding that the agency would not recommend that an enforcement action be initiated against the company for offering a pre-denominated bitcoin storage device in the form of an empty metal card without a license under the Transmitters of Money Act.
Enforcement and Litigation
- Consumer Financial Protection Bureau. Consumer Lenders & UDAAP. CFPB filed a consent order and stipulation against a nonbank consumer finance company that offered lease purchase agreements to consumers for allegedly tricking consumers into expensive leasing agreements by concealing the contract terms and costs and failing to provide legally required disclosures.
- Federal Deposit Insurance Corporation. Community Reinvestment Act (CRA) & Fintech. FDIC issued a "needs to improve" CRA grade to a fintech bank that offers credit to fleet services for fueling and servicing commercial vehicles, finding that the company allegedly engaged in illegal credit practices.
- Financial Crimes Enforcement Network. Bank Secrecy Act (BSA). FinCEN assessed a $15 million civil money penalty against a bank for allegedly failing to timely report suspicious transactions; failing to establish a due diligence program for correspondent accounts established, maintained, administered, or managed in the United States for foreign financial institutions; and failing to implement and maintain an Anti-Money Laundering program.
- Federal Trade Commission. Fair Credit Reporting Act (FCRA) & UDAAP. FTC released a complaint and settlement that will require two background report providers to pay $5.8 million to settle allegations that they deceived consumers about whether consumers had criminal records and that the companies violated the FCRA by operating as consumer reporting agencies while, among other things, failing to ensure the maximum possible accuracy of their consumer reports.
Research & Analysis
- Consumer Financial Protection Bureau. Student Loans. CFPB issued a report assessing the risks that students may face when entering into tuition payment agreements with colleges.
- Financial Crimes Enforcement Network. Bank Secrecy Act (BSA). FinCEN released a Financial Trend Analysis on patterns and trends contained in BSA reporting on suspected evasion of Russia-related export controls.
Michael Buckalew is a regulatory analyst with Davis Wright Tremaine LLP.