The Bureau of Consumer Financial Protection announced earlier this week that it would join ten non-US financial regulators in an alliance, called the Global Financial Innovation Network (GFIN), to encourage the growth of fintech — and, potentially, create a “global sandbox” for financial innovation.
The alliance was initially proposed, in February 2018, by the UK’s
In a little noticed, but important, speech, the Federal Reserve’s Vice Chairman for Supervision, Randal K. Quarles, reaffirmed late last month that the Fed remains committed to continued collaboration with international financial regulators.
International cooperation through, for example, the Basel Committee and the Financial Stability Board (FSB), has been a key pillar of post-financial
FinCEN’s Customer Due Diligence Rule for Financial Institutions (the “CDD Rule”) became effective yesterday. The rule, which was published by FinCEN on May 2016 (and slightly amended on September 29, 2017) is described in this Covington client alert. It requires covered financial institutions to: (i) adopt due diligence procedures to identify and verify a legal entity customer’s beneficial owners at the time a new account is opened and (ii) establish risk-based procedures for conducting ongoing customer due diligence, including developing customer risk profiles and implementing ongoing monitoring to identify and report suspicious activity and, on a risk basis, updating customer information.
In the months leading up to the CDD Rule’s effective date, FinCEN, the FFIEC and other agencies released a number of documents that provide practical guidance on its implementation. Those include:
Continue Reading Customer Due Diligence Rule — Key Practical Resources
The Federal Financial Institutions Examination Council (FFIEC) released yesterday data on mortgage lending at institutions covered by the Home Mortgage Disclosure Act (HMDA) — a total of just under 6,000 banks, credit unions and non-bank mortgage lenders. Concurrently, the Consumer Financial Protection Bureau (CFPB) released a “first look” report on mortgage market activity and trends based on a selection of the newly released data.
As the CFPB points out, this year’s release is notable for two reasons, among others:
The Consumer Financial Protection Bureau (the Bureau) announced today the eighth in a series of at least twelve broad Requests for Information (RFIs) seeking public comment on a range of Bureau activities and practices. Today’s RFI, on rulemaking by the Bureau, seeks comments and information on whether the Bureau should:
The RFI is focused on the substance of Bureau rules, and not the Bureau’s rulemaking process — which is the subject of a separate RFI. Moreover, it is limited to rules adopted, or to be adopted, by the Bureau since its creation in 2011. Another RFI, to be issued in the coming weeks, will seek comment on rules issued by other agencies and inherited by the Bureau in 2011, when the Bureau assumed responsibility for the enforcement of enumerated consumer laws previously administered by other Federal banking agencies.
The Consumer Financial Protection Bureau announced today that Kristen Donoghue would be appointed as its new Assistant Director of Enforcement, effective next Friday, November 17.
As we explained in an earlier post, Anthony Alexis, the former head of enforcement, announced his intention to step down from his position upon appointment of his successor. Donoghue
A recent poll — conducted by Lake Research Partners and Chesapeake Beach Consulting on behalf of Americans for Financial Reform and the Center for Responsible Lending — appears to show substantial public support for the Consumer Financial Protection Bureau (CFPB) and a number of its recent regulatory initiatives. The published poll results reflect, among other things, that:
This last result is particularly notable, as it could influence Congressional willingness to overrule the Bureau’s arbitration rule pursuant to the Congressional Review Act (see our client alert, at page 3, for more details).
But the poll’s results are not as unambiguous as they seem at first glance, and policymakers should be cautious in relying on them. Some of the support for the CFPB and CFPB policies reflected in the results could be ascribed to the way the pollsters asked their questions.
Continue Reading Public Support for the CFPB and its Arbitration Rule — Is The Evidence Clear?
In remarks on Wednesday before the Exchequer Club in Washington, Acting Comptroller of the Currency Keith Noreika responded to State regulators and consumer advocates who have criticized the OCC’s proposed special purpose fintech charter (the proposed charter is discussed in this Covington client alert).
Acting Comptroller Noreika’s comments on the fintech charter reflect an
In its decision in Kokesh v. SEC, issued on Monday, June 5, 2017, the Supreme Court unanimously ruled that “disgorgement” of ill-gotten gains by the Securities and Exchange Commission (“SEC”) is a “penalty” within the meaning of 28 U.S.C. § 2462. As a result, disgorgement is unavailable to the SEC in judicial proceedings involving conduct that took place more than five years before the filing of the government’s complaint. As explained below, because Section 2462 is a statute of general application (i.e., not specific to the SEC), the Court’s ruling could have implications for judicial civil penalty proceedings brought by the Consumer Financial Protection Bureau (“CFPB”), the Federal Trade Commission (“FTC”), the Commodity Futures Trading Commission (“CFTC”), and other financial and consumer regulators.
Continue Reading Kokesh v. SEC and Implications for Consumer and Financial Regulatory Agencies
The House of Representatives voted this afternoon to pass the Financial CHOICE Act (“CHOICE 2.0”), its comprehensive financial regulatory reform bill. The key provisions of CHOICE 2.0 are summarized in our client alert of April 24, 2017, available here, although the bill has evolved somewhat since April. As we wrote late last month, Representative