#EFTA – Federal Financial Analytics

6 10, 2023

DAILY100623

Eliza Allen2023-10-06T14:46:53-04:00October 6th, 2023|2- Daily Briefing|

Chopra Has Big Plans for Payments

Likely assuming the coast is clear after the Supreme Court seemed reluctant to undo its charter earlier this week, CFPB Director Chopra today announced a series of steps designed to give the Bureau considerably more control over the payment system. First, the agency plans to issue supplemental orders to “certain” bigtech companies – doubtless PayPal – to ascertain stablecoin plans and how this affects consumer data.

Waller Still Sees Little Need for CBDC

Governor Waller today continued his skeptical CBDC stance, noting that Fed work on the product is largely motivated by preparedness concerns. Nonetheless, any US CBDC will be two-tier with direct retail CBDC requiring Fed master account access not permitted under current law. Mr. Waller also strongly disputed claims that CBDCs such as those in China pose a threat to the US dollar and countered suggestions that FedNow is a CBDC-precursor, emphasizing that its primary purpose is to speed payments.

Daily100623.pdf…

8 02, 2023

FedFin on: Credit-Card Late Fee Regulation

Arezou Rafikian2023-02-09T09:43:39-05:00February 8th, 2023|The Vault|

Following on a controversial advance notice of proposed rulemaking, the CFPB has now released an NPR setting specific standards for credit-card late fees that also eliminates the inflation adjustments established by the Federal Reserve when implementing the 2009 credit-card law. The NPR also seeks comment on still more stringent late-fee restraints and limits on some or all of the other penalty fees now charged by some credit-card issuers. When issuing the ANPR, the Bureau also noted that it plans to advance other initiatives under its “junk-fee” standards, likely starting with those pursuant to ….

The full report is available to retainer clients. To find out how you can sign up for the service, click here and here.…

8 02, 2023

CREDITCARD36

Eliza Allen2023-02-08T13:00:21-05:00February 8th, 2023|1- Financial Services Management|

Credit-Card Late Fee Regulation

Following on a controversial advance notice of proposed rulemaking, the CFPB has now released an NPR setting specific standards for credit-card late fees that also eliminates the inflation adjustments established by the Federal Reserve when implementing the 2009 credit-card law. The NPR also seeks comment on still more stringent late-fee restraints and limits on some or all of the other penalty fees now charged by some credit-card issuers. When issuing the ANPR, the Bureau also noted that it plans to advance other initiatives under its “junk-fee” standards, likely starting with those pursuant to the Electronic Funds Transfer Act affecting a wide range of payment and transaction-account products. Should it then follow the model proposed here for credit cards, significant alterations in current business practice could occur with uncertain consumer benefits despite nominal upfront savings.

CREDITCARD36.pdf…

21 07, 2022

DAILY072122

Eliza Allen2023-01-04T15:58:15-05:00July 21st, 2022|2- Daily Briefing|

Housing Prices Session Ignites Familiar Partisan Debates

Today’s Senate Banking Committee Hearing on Housing Price Increases was another session of partisan discussion of the housing market and how to address it. Chairman Brown (D-OH) focused on the economic stressors that result from housing insecurity, emphasizing the consequences on families of color.

Senate Banking Republicans Demand FHFA Reverse Racial Equity Plans

Following yesterday’s hearing (see Client Report GSE147), Sen. Thom Tillis (R-NC) and eleven other Senate Banking Republicans sent a letter to Director Thompson strongly objecting to what they call “affirmative-action” subsidies, calling them unconstitutional and beyond the FHFA’s mandate and the Enterprises’ charters.

BIS CPMI Identifies Benefits, Barriers to Multilateral Payment System Platforms

The BIS Committee on Payments and Market Infrastructures published an article today arguing that multilateral platforms can alleviate some payment system frictions, but several challenges remain. The article claims that multilateral platforms can shorten processing chains, facilitate standardization, and process multiple currencies, resulting in faster payments.

CFPB Sure Now to Tackle Zelle Scams

Following media coverage yesterday suggesting near-term CFPB action, the majority of Senate Banking Democrats have called on the Bureau to do exactly what it appears to contemplate: take action to make banks offering Zelle responsible not only for fraud, but also scams to which consumers give initial consent.

Daily072122.pdf…

28 04, 2022

Daily042822

Eliza Allen2023-03-01T14:51:33-05:00April 28th, 2022|2- Daily Briefing|

FinCEN Head Pleads for Funding to Advance Rulemaking, Sanctions

Acting Director of FinCEN Himamauli Das testified at a poorly attended HFSC hearing today, calling for more funding to handle not only the challenges created by the invasion of Ukraine, but also the many standards required by the 2021 AML Act (see FSM Report AML133). Under questioning, Mr. Das agreed that the agency is falling behind on the beneficial ownership rules, promising to do better as quickly as resources will allow.

Fraudulent-Authorization Payment Bill Advances

At today’s HFSC’s Task Force on Financial Technology hearing, Chair Lynch (D-MA) advanced draft legislation stipulating bank accountability for fraudulent authorizations under the Electronic Funds Transfer Act. This measure builds on complaints voiced earlier this week detailed by Sens. Warren (D-MA) and Menendez (D-NJ) attacking Zelle, with Rep. Lynch saying that protecting consumers is an immediate priority.

Daily042822.pdf…

21 04, 2022

DAILY042122

Eliza Allen2023-03-02T10:35:34-05:00April 21st, 2022|2- Daily Briefing|

G20 Ministerial Ends in Disarray

The G20 finance ministerial yesterday was chaotic in ways not captured even by the public walk-out to protest Russia’s invasion well highlighted in recent media coverage. In fact, the ministerial failed to result in even the usual bland communique that summarizes discussions and details agenda items in increasingly general and non-binding terms.

CFPB Pursues Another “Repeat Offender” with Court Action

Continuing the CFPB’s commitment to tackle “repeat offenders”, the Bureau and New York Attorney General today filed a suit against MoneyGram alleging that the company – despite prior enforcement actions – stranded customers waiting for their money, botched error-resolution instructions, and lacked policies and procedures to ensure compliance.

Powell Ducks Globalization Debate

At a debate session today during the IMF annual meeting, Chairman Powell reiterated prior statements on monetary policy, for example that a fifty basis point rate hike may be appropriate, a point reinforced by his comment that the U.S faces higher core inflation than the E.U. even though the E.U. has higher price increases in food and energy costs.

Daily042122.pdf…

9 03, 2022

Daily030922

Arezou Rafikian2023-04-04T12:16:52-04:00March 9th, 2022|2- Daily Briefing|

President Presses Crypto, CBDC Buttons
We will shortly provide clients with an in-depth analysis of President Biden’s executive order setting the stage for substantive U.S. action across the digital-asset sector. We note at the outset that, according to the fact sheet, the order comes as close to demanding a CBDC as the President’s authority over the Fed and Secretary Yellen’s reservations doubtless allowed. The Fed is told to “place urgency” on its research, a demand likely to motivate the Fed to accelerate the very leisurely pace towards some sort of CBDC decision described in last month’s discussion draft (see FSM Report CBDC10).

Long-Awaited LIBOR-Certainty Bill Set for Enactment
Sen. John Tester (D-MN) today to ABA indicated that the Senate version of House-passed LIBOR-transition legislation is in the omnibus spending bill set to pass by the end of this week in order to keep the government open.

CFPB Targets Employer Financial Products, Data
The CFPB today detailed its agenda following meetings on the extent to which U.S. workers are placed at financial risk by their employers.

Daily030922.pdf…