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On May 20, 2020, the federal financial institution regulatory agencies—the Federal Reserve Board, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency—issued principles for responsibly offering small-dollar loans in order to meet consumers’ growing short-term credit needs.
Continue Reading Federal Agencies Share Principles for Offering Small-Dollar Loans

On Wednesday, March 27, 2019, the CFTC’s Market Intelligence Branch of the Division of Market Oversight issued a report on the impact of automated orders in futures markets to determine how technological change affects futures trading. Automated trading refers to orders that are generated or routed without human intervention. The CFTC presented the report before…

Innovation in financial services continues to move at a rapid pace. The significant increase in the number of fintech companies in recent years has highlighted a burgeoning market with significant economic potential, and a commercial need to create efficiencies and modernize the provision of financial products and services. Federal and state financial services regulators remain…

On August 28, 2018, the Office of the Comptroller of the Currency (“OCC”) released an advanced notice of proposed rulemaking (“ANPR”) inviting comments on a revised Community Reinvestment Act (“CRA”) framework. In the ANPR, the OCC described its vision for a new CRA framework that would:

  • encourage more lending and investment activity in low and moderate income communities;
  • provide more consistency across CRA evaluations and ratings; and
  • promote clarity regarding CRA-qualifying activities.

The ANPR requests responses to 31 questions across several topic areas, including the current CRA regulatory approach; a modernized CRA regulatory approach; CRA-qualifying activities; and recordkeeping and reporting.…

Continue Reading OCC Releases Advanced Notice of Proposed Rulemaking Regarding CRA Framework

Yesterday, the Consumer Financial Protection Bureau (“CFPB”) and Federal Trade Commission (“FTC”) issued a joint annual report to Congress on their activities in 2017 to combat illegal debt collection practices under the Fair Debt Collection Practices Act (“FDCPA”), for which the agencies share responsibilities.
The report suggests that, even amidst other changes at the CFPB, debt collection activities remain an area of focus, particularly on the enforcement side. The report also highlights coordination between the FTC and CFPB at least on this issue. It remains to be seen how this coordination plays out practically in future investigations and how the CFPB handles similar overlapping authorities with other regulators.…

Continue Reading Regulators Issue Report on Activities to Combat Illegal Debt Collection Practices

For unprepared companies, whistleblowers can cause serious problems. Companies could be subject to burdensome investigations by law enforcement authorities or hit with substantial fines and other sanctions. Companies might even face exposure for alleged retaliation against a whistleblower if the situation is not handled carefully.

In this article for the New York Law Journal on…

On August 21, 2017, Keith Noreika, the Acting Comptroller of the Currency, sent a letter to Jeb Hensarling, the Chairman of the House Financial Services Committee, stating that the Office of the Comptroller of the Currency (“OCC”) is not, and never was, a part of Operation Chokepoint, and that Operation Chokepoint is not the policy of the OCC. Acting Comptroller Noreika sent the letter in response to a request from Chairman Hensarling that the OCC issue a formal repudiation of Operation Chokepoint.

In rejecting Operation Chokepoint, Acting Comptroller Noreika wrote that “the agency rejects the targeting of any business operating within state and federal law as well as any intimidation of regulated financial institutions into banking or denying banking services to particular businesses.” Acting Comptroller Noreika also stated that the OCC “expects the banks it supervises to maintain banking relationships with any lawful businesses or customers they choose, so long as they effectively manage any risks related to the resulting transactions and comply with applicable laws and regulations.” …
Continue Reading The OCC Rejects Operation Chokepoint in Letter to Chairman Hensarling

The OCC

On June 5, 2017, the White House announced that Donald Trump will nominate Joseph Otting to succeed Thomas J. Curry as Comptroller of the Currency.  Otting is the former CEO of OneWest Bank, where he worked for current Treasury Secretary Steve Mnuchin.

Otting is a longtime financial services executive who worked at U.S.…

The CFTC recently proposed amendments (the “Proposal”) to its regulations regarding certain duties of chief compliance officers (‘‘CCOs’’) of swap dealers (‘‘SDs’’), major swap participants (‘‘MSPs’’), and futures commission merchants (‘‘FCMs’’) (collectively, ‘‘Registrants’’); and certain requirements for preparing and furnishing to the Commission an annual report containing an assessment of the Registrant’s compliance activities. The…

On May 10, 2017, the Consumer Financial Protection Bureau (“CFPB”) issued a request for information on small business lending. In a press release accompanying the request, the CFPB stated that its goal is to “learn more about how small businesses engage with financial institutions, with a particular focus on women-owned and minority-owned small business,” in order to help “implement [its] data collection rule.” The small business data collection rule, mandated by Section 1071 of the Dodd-Frank Act but not yet proposed by the CFPB, will impose reporting requirements on financial institutions for information concerning “credit applications made by women-owned, minority-owned, and small businesses.” The CFPB has previously clarified that “financial institutions’ obligations under [S]ection 1701 do not go into effect until the Bureau issues necessary implementing regulations.”

The request for information does not come as a surprise, given the CFPB’s indication in its Fifth Annual Fair Lending Report (which we discussed last month) that it will increase its focus on small business lending. In a speech at the Small Business Lending Field Hearing held on May 10, CFPB Director Richard Cordray emphasized that “business opportunity — especially opportunities for small businesses — often hinges on the availability of financing.”

In the request for information, the CFPB acknowledged that it is in the “early stages” of implementing a small business data collection rule that is designed to “fill existing gaps in the general understanding of the small business lending environment” and identify “potential fair lending concerns regarding small businesses.” The CFPB further stated its belief that the rule should cover “an extensive share of the market and contain enough flexibility to analyze different market segments.” At the same time, the CFPB expressed interest in “exploring potential ways to implement [the rule] in a balanced manner” that would minimize burden to both industry and the CFPB.…

Continue Reading CFPB Issues Request for Information on the Small Business Lending Market