The White House on Monday will host an event on “safe, secure, and trustworthy artificial intelligence,” and officials are expected to announce the Artificial Intelligence Executive Order during the event, scheduled for 2:30 pm ET.
Consumer Financial Protection Bureau (CFPB) Enforcement Director Eric Halperin delivered remarks at the NCLC Consumer Rights Litigation Conference. Director Halperin discussed the CFPB’s enforcement work to date, challenges of the surveillance economy, opaque algorithms and automated decision making, and predatory lending and abusiveness.
Federal Reserve Board (FRB) Vice Chair for Supervision Michael Barr delivered opening remarks at the Economics of Payments XII Conference. Vice Chair for Supervision Barr discussed the state of the payments system and how to improve it.
National Credit Union Administration (NCUA) Chairman Todd Harper delivered remarks at the 2023 REACH Conference. Chairman Harper discussed the 2023 Q2 performance data and takeaways, warning signs of an economic slowdown, the decline of overdraft programs, artificial intelligence, and real-time payments.
The Federal Trade Commission (FTC) approved an amendment to the Safeguards Rule that would require nonbank financial institutions to report certain data breaches and other security events to the agency. The Amendment will require nonbank financial institutions to report when they discover that information affecting 500 or more people has been acquired without authorization as soon as possible, no later than 30 days after discovery of a breach. The requirement will become effective 180 days after it is published in the Federal Register.
Commissioner Hester Peirce of the Securities and Exchange Commission (SEC) published a statement regarding the SEC’s enforcement action against LBRY, Inc., which the SEC sued for allegedly offering unregistered securities in the form of LBRY tokens. In the statement, Commissioner Peirce questioned the SEC’s pursuit of an enforcement action against the company based on the facts and circumstances of the case and the remedies sought, which she argued were “entirely out of proportion to any harm.” Questioning the SEC’s approach, she added that, “our scorched earth approach in remedying the violation was completely out of proportion to any investor harm.”
Sen. Tim Scott (R-SC), Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, led Republican Committee members in a letter to Treasury Secretary Janet Yellen and U.S. Trade Representative Ambassador Katherine Tai warning that expanding Chinese payment networks may undermine U.S. foreign policy, threaten Americans’ sensitive financial and consumer data privacy, and violate international trade practices.
The Board of Governors of the Federal Reserve System (FRB), Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) released a final rule revising the Community Reinvestment Act (CRA) regulations to strengthen and modernize the rule and adapt to changes in the banking industry. The final rule takes effect on April 1, 2024, with staggered compliance dates of January 1, 2026, and January 1, 2027.
The agencies also issued joint finalized principles for climate-related financial risk management for large financial institutions. The principles are intended for the largest financial institutions, with $100 billion or more in total assets, and address physical and transition risks associated with climate change. Acting Comptroller Hsu, FDIC Chair Martin Gruenberg, and Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra, among others, issued statements in support of the finalized principles.
Representative Maxine Waters (D-CA), Ranking Member of the House Financial Services Committee released a statement applauding the CRA final rule.
Senate Banking Chair Sherrod Brown also released a statement supporting the CRA final rule.
The FRB proposed slashing the cap on the interchange fees banks are allowed to charge merchants for debit card transactions from 21 cents per transaction to 14.4 cents, while the so-called ad valorem element would be multiplied by 4 basis points instead of 5 basis points. The fraud-prevention adjustment, meanwhile, would increase slightly.
Overall, under the proposed framework, the interchange fee a debit card issuer could charge on a $50 transaction would be capped at 17.7 cents, down from 24.5 cents under the current rule, a decrease of nearly 28%.
The proposal also calls for the Fed to re-evaluate its cap on swipe fees every two years, using data that it has been collecting for more than a decade. Data would continue to be gathered in odd-numbered years, but the board would have to announce changes by March 31 of those years and implement them by July 1. These biannual changes would not be subject to public comment.
The Fed’s proposal drew a strong rebuke from Fed Governor Michelle Bowman, the board member designated to represent community banking interests.
Need to catch up on what happened last week? Check out our Midweek Update here.