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The Financial Crimes Enforcement Network (FinCEN) issued a final rule that requires minimum standards for anti-money laundering (AML) programs for banks lacking a federal functional regulator (the Federal Reserve Board, OCC, FDIC, OTS, NCAU, and SEC), i.e., banks and similar financial institutions that are subject only to state regulation and supervision, and certain international banking entities (collectively, “covered banking entities”).

The final rule also extends customer identification program (CIP) and beneficial ownership requirements (also known as the Customer Due Diligence or CDD Rule) to covered banking entities. Such banking entities may include private banks, international banking entities, non-federally-insured credit unions, state banks, savings associations, and trust companies.

The Centers for Disease Control and Prevention (CDC) on September 1 issued an order under Section 361 of the Public Health Service Act to temporarily—at least through the end of 2020—halt residential rental evictions for Americans struggling to pay rent due to the coronavirus (COVID-19) pandemic. The CDC states that the ban is necessary to mitigate the spread of COVID-19, a historic threat to public health, by preventing homelessness and facilitating stay-at-home/social distancing directives.

The Federal Housing Finance Agency (FHFA) announced on August 27 that Fannie Mae and Freddie Mac (the GSEs) will extend their moratorium on foreclosures and evictions until at least December 31, 2020. The foreclosure moratorium applies to GSE-backed, single-family mortgages only. The evictions moratorium applies to properties that have been acquired by a GSE through foreclosure or deed-in-lieu of foreclosure transactions (real estate owned, or REO, properties). Currently, FHFA projects additional expenses of $1.1 to $1.7 billion will be borne by the GSEs due to the existing foreclosure moratorium and its extensions related to the coronavirus (COVID-19) pandemic.

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.

Section 19 of the Federal Deposit Insurance Act prohibits, without the FDIC’s prior consent, any person from being affiliated with, or participating in the affairs of, an insured depository institution who has been convicted of a crime of dishonesty or breach of trust or money laundering, or who has entered a pretrial diversion or similar program in connection with the prosecution of such an offense. The FDIC’s final rule makes some useful and burden-reducing changes to current FDIC policies and practices:

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.

The FFIEC is an interagency body composed of five banking regulators (FRB, FDIC, NCUA, OCC, and CFPB) that is empowered to prescribe uniform principles, standards, and report forms to promote uniformity in the supervision of financial institutions. The principles in the statement follow on the heels of previous statements the FFIEC issued encouraging financial institutions to work prudently with borrowers affected by COVID-19.

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. This “payments charter” could be especially appealing for those companies looking for a national licensing platform for their payments business because it would provide federal preemption of state money transmitter licensing and related laws, which would eliminate the need to obtain a license to operate in each state.

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 Office of the Comptroller of the Currency (OCC) issued a similar final rule on May 25 that reaffirms the enforceability of the interest rate terms of national banks’ loans following their sale, assignment, or transfer. The OCC’s rule (on which we previously reported) takes effect 60 days after its June 2 publication in the Federal Register, or August 3.

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. The changes will be effective October 1, 2020. Among other things, these final amendments will:

(i)  permanently exempt qualifying foreign excluded funds from being treated as “banking entities” subject to the Volcker Rule proprietary trading and covered fund investment restrictions;

(ii)  establish certain limited exceptions to the “Super 23A” prohibitions, which will allow banking entities to enter into certain types of low-risk transactions with a sponsored or advised covered fund;

The Federal Housing Finance Agency (FHFA) announced on June 17 that Fannie Mae and Freddie Mac (the GSEs) are once again extending their moratorium on foreclosures and evictions until at least August 31, 2020. We had discussed the previous extension on the moratorium, which was set to expire on June 30, in a previous blog post. The foreclosure moratorium applies to GSE-backed, single-family mortgages only.

We think of our All Things FinReg blog to be global in nature, so when interesting regulatory developments occur somewhere in our blog footprint (namely, the planet), we try to highlight them, especially where they may have relevance beyond the jurisdiction or region where such developments occur. A recent action by the French competition authority (ADC) may be one such event.

Specifically, the ADC has launched a public consultation on the fintech sector in France, in particular with regard to payment services. The consultation focuses on the two types of new players in the payments space: (1) the role of big digital platforms and (2) the effect of smaller innovative payment service providers on competition in the financial services sector.