All Things FinReg

As we discussed in a prior LawFlash, US President Donald Trump signed four executive actions that purportedly extend various aid measures for individuals impacted by the coronavirus (COVID-19) pandemic on August 8.

The Federal Deposit Insurance Corporation (FDIC) announced on July 24 the approval of a final rule that will ease restrictions on banks’ hiring process for individuals with certain criminal offenses on their records. The final rule codifies and revises the current and longstanding FDIC Statement of Policy on this topic and will be effective 30 days after its publication in the Federal Register.

The Federal Financial Institutions Examination Council (FFIEC) on behalf of its members issued a statement on August 3 setting forth prudent risk management and consumer protection principles for financial institutions as initial coronavirus (COVID-19) related loan accommodation periods end and they consider additional accommodations.

In a series of recent interviews (including with the American Bankers Association and a podcast with the ABA Banking Journal), Acting Comptroller of the Currency Brian Brooks discussed the Office of the Comptroller’s (OCC’s) plans to soon roll out another special purpose national bank (SPNB) charter specifically geared toward payments companies.

The Federal Deposit Insurance Corporation (FDIC) issued a final rule on June 25 that reaffirms the enforceability of the interest rate terms of loans made by state-chartered banks and insured branches of foreign banks (collectively, state banks) following the sale, assignment, or transfer of the loan. The rule also provides that whether interest on a loan is permissible is determined at the time the loan is made, and is not affected by a change in state law, a change in the relevant commercial paper rate, or the sale, assignment, or other transfer of the loan. The final rule follows the FDIC’s proposed rule on this topic, and will take effect 30 days after publication in the Federal Register.

The Financial Crimes Enforcement Network (FinCEN) published guidance (Guidance) on customer due diligence requirements under the Bank Secrecy Act (BSA) for hemp-related customers on June 29. The Guidance, which recognizes hemp as defined under the Agriculture Improvement Act of 2018 (the 2018 Farm Bill), advises financial institutions on their BSA customer due diligence requirements for hemp customers. This Guidance supplements—but does not replace—the December 3, 2019 interagency statement on providing financial services to customers engaged in hemp-related businesses.

The US Supreme Court on June 29 ruled in Seila Law v. Consumer Financial Protection Bureau that the Consumer Financial Protection Bureau’s (CFPB’s) structure unconstitutionally insulates the agency from presidential oversight and must be altered.

The Consumer Financial Protection Bureau (CFPB or Bureau) issued an interim final rule (IFR) on June 23, 2020 that temporarily permits mortgage servicers to offer to borrowers impacted by the coronavirus (COVID-19) pandemic certain loss mitigation options based on the evaluation of an incomplete loss mitigation application.

The US federal financial regulatory agencies with responsibility for implementing and enforcing Section 13 of the Bank Holding Company Act, commonly known as the Volcker Rule, have finalized amendments to the “covered fund” and “foreign excluded fund” provisions of the rule.

On June 18, 2020, the Consumer Financial Protection Bureau (CFPB or Bureau) issued a procedural rule to launch a new pilot advisory opinion (AO) program to publicly address regulatory uncertainty in the Bureau’s existing regulations. The pilot AO program will allow entities seeking to comply with regulatory requirements to submit a request where uncertainty exists, and the Bureau will then select topics based on the program’s priorities and make the responses available to the public.