- Top Lines
CA AB 2269, California’s legislation to regulate digital financial assets and digital financial asset activity, passed each chamber of the California legislature. Governor Newsom will have 30 days to sign or veto the legislation after it is delivered to his desk. Read our summary of the legislation here.
- Weekly Wrap Up
The Federal Trade Commission (FTC) has taken action against credit services company Credit Karma. The FTC alleges that the company used claims that consumers were “pre-approved” and had “90% odds” to entice them to apply for offers that, in many instances, they did not qualify for. The agency’s order requires the company to pay $3 million to consumers who spent time applying for these credit cards and to stop making these types of deceptive claims.
The Federal Deposit Insurance Corporation (FDIC) issued the lists of institutions scheduled for a Community Reinvestment Act (CRA) examination during the fourth quarter 2022 and first quarter 2023.
The Federal Reserve Banks have narrowed the timing of the FedNow Service launch to mid-year 2023, specifically targeting a production rollout of the service sometime between May and July. This further defines the previously communicated 2023 launch window for the anticipated instant payments service and comes as the FedNow Pilot Program prepares to enter technical testing for the service starting in September.
Vice Chair Lael Brainard gave a speech about FedNow’s progress, and called for industry stakeholders to devote the resources necessary to support instant payments.
The Consumer Financial Protection Bureau (CFPB) issued the first in a series of reports focusing on the finances of consumers living in rural communities across the country with higher concentrations of Persistent Poverty Counties.
The Department of Legal Counsel at the Department of Justice (DOJ) released an opinion stating that the FDIC Chairperson can not prevent a majority of the FDIC board from presenting items for a vote and decision.
Acting Comptroller of the Currency Michael J. Hsu discussed the importance of community banks, and the challenges and opportunities of digitalization, in a meeting with the Texas Bankers Association in Dallas.
In his remarks, the Hsu emphasized the Office of the Comptroller of the Currency’s commitment to community banks, and highlighted initiatives to support community banks in the areas of reduced assessments, de novo licensing, risk-based supervision, and regulation.
National Credit Union Administration (NCUA) Chairman Todd M. Harper delivered remarks at the African-American Credit Union Coalition Annual Conference. Harper discussed the importance of efforts to advance DEI and support MDIs.
Pennsylvania Attorney General Josh Shapiro filed a lawsuit against Progressive Leasing for violating a state disclosure law that ensures hefty leasing fees are clearly and conspicuously shown to consumers who are considering rent-to-own financing. The Rental Purchase Agreement Act (RPAA) requires certain terms and conditions of rent-to-own transactions to be advertised to consumers via a hang tag that is physically attached to the products offered for rent.
U.S. Representative Stephen F. Lynch (D-MA-08), Chairman of the Task Force on Financial Technology, sent a letter to Credova CEO Dusty Wunderlich requesting information regarding the use of Credova’s “Buy Now, Pay Later” (BNPL) services to finance online purchases for guns, ammunitions, and firearm accessories.
U.S. Senator Elizabeth Warren (D-MA) sent a letter to the DOJ urging the Department to issue and implement updated student debt bankruptcy guidance following the Biden-Harris administration’s historic decision to cancel up to $20,000 in student debt for up to 43 million borrowers and overhaul the student loan system.
The IDB Group — composed of the Inter-American Development Bank, IDB Invest and IDB Lab — and Colombia’s Davivienda Bank successfully issued the first blockchain bonds in Latin America and the Caribbean, as a pilot project within Colombia’s regulatory innovation sandbox. This pilot is the first of its kind in the region.
- ICYMI
Congressman Tom Emmer (R-MN), Ranking Member of the House Financial Services Subcommittee on Oversight and Investigations and co-Chair of the Congressional Blockchain Caucus, sent a letter to Treasury Secretary Janet Yellen regarding “the unprecedented sanctioning of Tornado Cash,”an open-source cryptocurrency mixer used for enhancing privacy in blockchain-based transactions. The crux of the issue is the Office of Foreign Assets Control’s (OFAC) use of sanctions against an open-source tool allegedly used for money laundering as opposed to sanctions against individual wallet addresses only. Rep. Emmer stated that “the growing adoption of decentralized technology will certainly raise new challenges for OFAC. Nonetheless, technology is neutral and the expectation of privacy is normal.”
- Upcoming Hearings & Events
Wednesday, September 7, at 2:00 PM EST – Brookings will hold an event with Fed Vice Chair Michael Barr entitled “Making the financial system safer and fairer.” Register here.
Thursday, September 8, at 10:00 AM EST – The Senate Committee on Banking, Housing, and Urban Affairs will hold a hearing entitled “Current Issues in Insurance.”
Thursday, September 8, at 12:00 PM EST – The Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets will convene for a virtual hearing entitled, “Accounting and Auditing Standards in the 21st Century.”
Wednesday, September 14, at 10:00 AM EST – The full Committee will convene for a hybrid hearing entitled, “When Banks Leave: The Impacts of De-Risking on the Caribbean and Strategies for Ensuring Financial Access.”
Tuesday, September 20, at 10:00 AM EST – The Subcommittee on National Security, International Development, and Monetary Policy will convene for a hybrid hearing entitled, “Under the Radar: Alternative Payment Systems and the National Security Impacts of Their Growth.”
Tuesday, September 20, at 2:00 PM EST – The Subcommittee on Diversity and Inclusion will convene for a hybrid hearing entitled, “Review of Diversity and Inclusion at America’s Largest Insurance Companies.”
Wednesday, September 21, at 10:00 AM EST – The full Committee will convene for a hybrid hearing entitled, “Holding Megabanks Accountable: Oversight of America’s Largest Consumer Facing Banks.”
Thursday, September 22, at 9:00 AM EST – The Subcommittee on Housing, Community Development, and Insurance will convene for a hybrid hearing entitled, “State of Emergency: Examining the Impact of Growing Wildfire Risk on the Insurance Market.”