March 1, 2024

The House Financial Services Committee advanced five pieces of legislation out of Committee. The bills include:

  • H.J. Res. 109, which overturns the U.S. Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin (SAB) 121. SAB 121, introduced as staff-level guidance in March 2022 and implemented the following month, but later found to be a rule, states that digital asset custodians should report a liability and “corresponding assets” on their balance sheets for all digital assets held in custody;

  • H.R. 6864, the “HUD Accountability Act of 2023,” which requires the U.S. Department of Housing and Urban Development (HUD) Secretary to testify before the Committee annually;

  • H.R. 7280, the “HUD Transparency Act of 2024,” which requires the HUD Inspector General to testify before the Committee annually;

  • H.R. 7156, the “Combating Money Laundering in Cyber Crime Act of 2024,” which closes a gap limiting the U.S. Secret Service’s ability to  investigate various crimes related to digital asset transactions and to counter transnational cyber-criminal activity; and

  • H.R. 7462, the “Wildfire Insurance Coverage Study Act of 2023,” which  requires the U.S. Government Accountability Office to conduct a study on the damage of wildfires, including the risks they pose to property, the existing state of insurance coverage, potential government mitigation responses, and the challenges faced by private insurers underwriting wildfire risk.

The U.S. Department of Commerce issued an advance notice of proposed rulemaking (ANPRM) seeking public comment to inform the potential development of regulations to secure and safeguard the Information and Communications Technology and Services (ICTS) supply chain for connected vehicles (CVs). The ANPRM seeks information regarding the security of connected vehicles with technology manufactured in the People’s Republic of China. 

The Energy Information Administration (EIA), a semi-independent agency within the Department of Energy, agreed to stop its emergency information collection of digital asset miners’ energy use. Last week, the Texas Blockchain Council and Riot Platforms, a digital asset mining company, sued the EIA in the U.S. District Court for the Western District of Texas, requesting a temporary restraining order. The parties have entered into an agreement bound by a court order that nullifies the EIA’s emergency declaration to collect information about digital asset miners’ energy use and re-issue its request for comment on how the energy information collection surveys should be developed.    

The Federal Reserve Board (FRB) published its semi-annual Monetary Policy Report to the Senate Committee on Banking, Housing, and Urban Affairs and to the House Committee on Financial Services, along with testimony from Chair Jerome Powell.

FRB Governor Christopher Waller delivered a speech on quantitative tightening, including remarks on the paper “Quantitative Tightening around the Globe: What Have We Learned?” Governor Waller discussed quantitative easing versus quantitative tightening and normalizing the Fed’s balance sheet, and stated that the paper will serve as a major reference for researchers and central banks.

The Federal Deposit Insurance Corporation (FDIC) issued the lists of institutions scheduled for a Community Reinvestment Act (CRA) examination during Q2 and Q3 of 2024. CRA regulations require each federal bank and thrift regulator to publish its quarterly CRA examination schedule at least 30 days before the beginning of each quarter. 

The Consumer Financial Protection Bureau (CFPB) issued a circular to law enforcement agencies and regulators explaining how companies operating comparison-shopping tools can break the law when they steer consumers to certain products or lenders because of kickbacks. The circular explains how these practices may violate federal law and highlights examples of illegal arrangements.

On Wednesday, March 6, the SEC will meet to consider the adoption of the climate disclosure rule. The rule would require registrants to disclose certain climate-related information in their registration statements and annual reports.

The SEC announced that William Birdthistle, the Director of the Division of Investment Management, will depart the agency, effective March 8, 2024. Natasha Vij Greiner, currently the Deputy Director of the Division of Examinations, will be named Director of the Division of Investment Management upon Mr. Birdthistle’s departure. The Division oversees regulatory policy for investment advisers and investment companies, including mutual funds and other investment products and services relied upon by retail investors.

Senators John Hickenlooper (D-CO) and Thom Tillis (R-NC) introduced the Improving Disclosure for Investors Act of 2024, which would require the SEC to propose rules allowing for the electronic delivery of regulatory documents to investors. The SEC currently permits electronic delivery of certain documents, but has not comprehensively updated its framework in over 20 years. This legislation requires the SEC establish a means for investors to opt out of electronic delivery at any time and receive paper documents.

The Conference of State Bank Supervisors (CSBS) updated the Nonbank Mortgage Servicer Prudential Standards. The CSBS model state regulatory prudential standards for nonbank mortgage servicers establish common financial capacity, governance, and risk management requirements for nonbank mortgage servicers. The CSBS Board of Directors approved the standards in July 2021 to enhance and align states’ existing authority over the fast-growing area of nonbank mortgage servicing. Since then, six states have fully adopted the standards, and two have adopted the standard’s financial condition requirements. Thirteen additional states are pursuing the standards in 2024.

Senate Minority Leader Mitch McConnnell (R-KY) announced that he will step down from his position in November. Senator McConnell has been the leader of the Senate Republican Conference since 2007 and is the longest serving Senate party leader in U.S. history.

President Biden is issuing an Executive Order (EO) intended to protect Americans’ personal data from exploitation by countries of concern. The EO directs federal agencies, including the Departments of Justice, Homeland Security, Health and Human Services, among others, to issue regulations that establish clear protections for Americans’ sensitive personal data from access and exploitation.

Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra issued a statement that the CFPB will be proposing new rules consistent with the EO.

Need to catch up on what happened last week? Check out our February 28th Midweek Update here