May 12, 2023

The Federal Deposit Insurance Corporation (FDIC) Board of Directors issued a notice of proposed rulemaking (NPRM), which would implement a special assessment to recover the cost associated with protecting uninsured depositors following the closures of Silicon Valley Bank and Signature Bank. Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra’s statement supporting the NPRM can be found here

Following the recent finalization of two new rules aimed at closing gaps in capital access for America’s small business owners, the Small Business Administration (SBA) announced its plans to streamline eligibility determinations of SBA-backed loans and add new fraud review on all loans. The SBA also published new guidelines for lenders on how to make SBA loans as part of a new Standard Operating Procedure (SOP); a Procedural Notice removing the requirement for a Loan Authorization; and an Informational Notice clarifying affiliation standards.

Federal Reserve Governor Michelle Bowman delivered remarks covering recent bank failures, supervision, regulation, bank management culture, and technology at the 21st Annual Symposium on Building the Financial System of the 21st Century in Frankfurt, Germany.

House Financial Services Committee Ranking Member Maxine Waters (D-CA) and Senator Mark Warner (D-VA) sent a letter to the Environmental Protection Agency (EPA) urging them to ensure that investments through the Greenhouse Gas Reduction Fund (GGRF) serve to strengthen diverse-owned financial institutions dedicated to climate financing in low-income communities and communities of color.

The Department of the Treasury and Internal Revenue Service (IRS) released guidance that provides detailed information about the domestic content bonus under the Inflation Reduction Act for clean energy projects and facilities that meet American manufacturing and sourcing requirements. The guidance was developed in partnership with the Department of Energy and Department of Transportation. 

The California Department of Financial Protection and Innovation (DFPI) released its Review of DFPI’s Oversight and Regulation of Silicon Valley Bank (SVB).

The Public Company Accounting Oversight Board (PCAOB) released their inspection reports for two firms inspected in 2022: KPMG Huazhen LLP in mainland China and PricewaterhouseCoopers in Hong Kong.

Seth Frotman, General Counsel and Senior Advisor to the Director at the CFPB, delivered remarks on Consumer Financial Protection and Payments in the 21st Century at the Innovative Payments Conference.

The New York Department of Financial Services (NYDFS) issued proposed guidance to New York State-regulated banking organizations and regulated non-depository financial institutions to notify them of the Department’s expectation that they update their framework for the review and assessment of the character and fitness of their directors, senior officers, and managers, both upon onboarding and on an ongoing basis.

Treasury Under Secretary for Domestic Finance Nellie Liang delivered remarks on Systemic Liquidity and Financial System Resilience at the International Swaps and Derivatives Association Annual General Meeting.

House Financial Services Committee (HFSC) Chairman Patrick McHenry (R-NC) and HFSC Digital Assets, Financial Technology and Inclusion Subcommittee Chairman French Hill (R-AR), as well as Committee leadership, sent a comment letter to the Securities and Exchange Commission (SEC) demanding that the SEC rescind its proposed rule increasing the cost of offering custodial services for registered investments advisors (RIAs).

The CFPB issued a new circular affirming that a bank may violate federal law if it unilaterally reopens a deposit account to process transactions after a consumer has already closed it.

HFSC Chairman McHenry sent a letter to House Appropriations Committee Chairwoman Kay Granger (R-TX) and Ranking Member Rosa DeLauro (D-CT), outlining Committee Republicans’ priorities for fiscal year (FY) 2024 appropriations, including “rescission of unspent “emergency” funds, strengthening public markets, nurturing innovation, countering the influence of China, and fostering a vibrant financial system.”

House Energy and Commerce Committee Republicans, led by Chair Cathy McMorris Rodgers (R-WA), and Committee Democrats, led by Ranking Member Frank Pallone, Jr. (D-NJ), sent a letter to the heads of data broker companies, requesting information about the companies’ use of consumer data. 

A group of seven senators, Sens. Elizabeth Warren (D-MA), Senate Banking Committee Chair Sherrod Brown (D-OH), Jack Reed (D-RI), Richard Blumenthal (D-CT), Tammy Baldwin (D-WI), Peter Welch (D-VT) and Bernie Sanders (I-VT), sent a letter to the CEOs of ten of the largest U.S. credit card issuers, demanding details about the companies’ late fee practices.

Federal Trade Commission (FTC) Deputy Chief Technology Officer Alex Gaynor delivered remarks defining cloud services and highlighting cybersecurity risks at a FTC panel event on cloud computing.

In remarks at Fintech Nexus in New York, CFPB Director Rohit Chopra said that banks should make it easier for consumers to switch accounts and make lending decisions with less reliance on credit scores.

In remarks at Fintech Nexus in New York, CFPB Director Rohit Chopra said that banks should make it easier for consumers to switch accounts and make lending decisions with less reliance on credit scores.

The SEC and Commodity Futures Trading Commission (CFTC) each brought enforcement actions against HSBC and Scotia Capital, an affiliate of the Bank of Nova Scotia, for recordkeeping and supervision failures regarding use of personal text messages and WhatsApp. 

The Senate Committee on Banking, Housing and Urban Affairs’ held a hearing considering the need for more stringent accountability measures for banking executives following the collapses of SVB and Signature Bank. 

The HFSC Subcommittee on Housing and Insurance and the Senate Committee on Banking, Housing, and Urban Affairs held hearings on the reauthorization of the National Flood Insurance Program (NFIP).

The Senate Banking Committee, Subcommittee on Housing, Transportation, and Community Development held a hearing addressing the need for affordable housing in rural communities.

New York Attorney General Letitia James announced legislation to tighten regulations on the cryptocurrency industry to protect investors, consumers, and the broader economy. Attorney General James alleged the multi-billion-dollar industry lacks robust regulations, making it prone to dramatic market fluctuations, and has been used to hide and facilitate criminal conduct and fraud. Attorney General James’ program bill, which proposes the strongest and most comprehensive set of regulations on cryptocurrency in the nation, would increase transparency, eliminate conflicts of interest, and impose commonsense measures to protect investors, consistent with regulations imposed on other financial services.

The Securities and Exchange Commission (SEC) adopted amendments to Form PF, the confidential reporting form for certain SEC-registered investment advisers to private funds. The amendments are designed to enhance the ability of the Financial Stability Oversight Council (FSOC) to assess systemic risk and to bolster the Commission’s oversight of private fund advisers and its investor protection efforts. SEC Commissioner Jaime Lizárraga issued a statement discussing the amendments entitled “Enhancing Financial Stability and Fulfilling Our Investor Protection Mandate.” Commissioner Lizárraga’s remarks track with recent FSOC announcements around nonbank SIFI designation and offer insights to the types of firms FSOC may be targeting.

Need to catch up on what happened last week? Check out our May 5th newsletter here.