Weekly Wrap Up

October 6, 2023

Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra delivered remarks at the Brookings Institute’s event entitled “Making America’s payment system work for a digital century.” He announced that the notice of proposed rulemaking for consumer access to financial records (Section 1033 of the Dodd-Frank Act) will be released this month. The CFPB is also issuing supplemental market-monitoring orders to certain “big tech” companies regarding data usage; it is exploring additional guidance on the Electronic Funds Transfer Act and its application to digital assets; and the CFPB is looking into using supervision to examine nonbanks offering consumer payments. Director Chopra also said the Financial Stability Oversight Council (FSOC) should examine systemically important financial institution (SIFI) designation for nonbanks.      

As part of the Biden-Harris Administration’s Investing in America agenda, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) released guidance to increase access to Inflation Reduction Act credits at point of sale for new and previously owned clean vehicles, including all-electric, plug-in hybrid, and fuel cell electric vehicles.

Department of Justice (DOJ) Deputy Attorney General Lisa O. Monaco announced a new safe harbor policy for voluntary self-disclosures made in connection with mergers and acquisitions. Deputy Attorney General Monaco discussed the expansion of corporate enforcement efforts in the national security realm, new tools used to penalize corporate misconduct and incentivize good corporate citizenship, efforts to promote voluntary self-disclosures including the new Mergers & Acquisitions Safe Harbor policy, and areas with further opportunity for innovation and expansion. Deputy Attorney General Monaco also stated that the DOJ is increasing by 40% the number of prosecutors in the Criminal Division’s Bank Integrity Unit, which holds accountable financial institutions that violate U.S. sanctions and the Bank Secrecy Act.

The CFPB announced the appointment of new members to the Consumer Advisory Board, Community Bank Advisory Council, Credit Union Advisory Council, and Academic Research Council.

Seth Frotman, CFPB General Counsel and Senior Advisor to the Director, delivered remarks at the New Jersey Citizen Action Education Fund’s 14th Annual Financial Justice Summit. Mr. Frotman discussed the need for state and federal cooperation, medical debt, the impact of medical debt, and medical financial products. Notably, he commended New Jersey on its progress in “fighting off efforts to allow problematic earned wage access products,” among other things.

Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg delivered remarks at the 2023 Community Banking Research Conference sponsored by the Federal Reserve System, FDIC, and the Conference of State Bank Supervisors (CSBS). Chairman Gruenberg discussed lessons learned from the 2023 bank failures, community bank resilience, and deposit insurance reform and the role of research.

Public Company Accounting Oversight Board (PCAOB) Chair Erica Williams delivered remarks at the 2023 PCAOB Conference on Auditing and Capital Markets. Chair Williams discussed the PCAOB’s work to modernize their standards, enhance their inspections, and strengthen their enforcement.

Commodity Futures Trading Commission (CFTC) Commissioner Kristin Johnson delivered keynote remarks at Rice University’s Baker Institute for Public Policy Annual Energy Summit. Commissioner Johnson discussed the CFTC’s role in the oversight of carbon offset markets.

CFTC Commissioner Summer Mersinnger said in an interview that “we don’t have to reinvent the wheel,” pointing to Europe-wide digital asset regulations that the EU is preparing to implement. “We’re going to do our own thing, but we can do that while embracing some of the framework that [Europe’s markets in crypto assets bill] offers,” Mersinger said. 

Senator Sherrod Brown (D-OH), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, wrote a letter to Acting Comptroller Michael Hsu and Federal Reserve Vice Chair for Supervision Michael Barr raising concerns about alleged unfair labor practices at Wells Fargo.

Representative Maxine Waters (D-CA), Ranking Member of the House Financial Service Committee released a statement following oral arguments this week in Consumer Financial Protection Bureau (CFPB) v. Community Financial Services Association of America (CFSA), regarding the constitutionality of the agency’s independent funding structure.

The Basel Committee on Banking Supervision met to take stock of recent market developments and risks to the global banking system, and to discuss a range of policy and supervisory initiatives. The Committee published a report on the 2023 banking turmoil, agreed to consult on disclosure frameworks for climate-related financial risks and banks’ cryptoasset exposures, and approved the 2023 assessment exercise for global systemically important banks (G-SIBs).

CSBS released the 2023 Annual Survey of Community Banks. The survey captures community bankers’ views on key risks, compliance costs, technology, competition, and liquidity and funding, among other areas. Cybersecurity threats and liquidity concerns were rated as top internal concerns. 

Representatives Gregory Meeks (D-NY), Al Green (D-TX), Bill Foster (D-IL), Joyce Beatty (D-OH), Juan Vargas (D-CA), Josh Gottheimer (D-NJ), Sean Casten (D-IL), Sylvia Garcia (D-TX), Wiley Nickel (D-NC), and Brittany Petterson (D-CO) sent a letter to CFPB director Chopra urging the Bureau to include payroll data in the Dodd-Frank Section 1033 open banking rulemaking. 

On Tuesday, the U.S. Supreme Court held oral argument in the Community Financial Services Association of America Ltd. (CFSA) v. Consumer Financial Protection Bureau (CFPB), in which the CFSA argued that the CFPB’s “double insulated” funding structure is unconstitutional. According to reports, the Supreme Court Justices suggested they are not likely to declare the CFPB’s funding system unconstitutional. Read our summary here.

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