#preemption – Federal Financial Analytics

19 05, 2023

CRYPTO44

Max Camateros-Mann2023-05-19T09:47:04-04:00May 19th, 2023|5- Client Report|

Preemption, SEC Remain Principle Stablecoin Roadblocks

Although there were still considerable party-line differences of opinion on stablecoin legislation, today’s HFSC Digital-Assets Subcommittee hearing suggests that remaining divides are narrowing, increasing the odds of a new federal-regulatory framework. However, this is not to say that HFSC Members will be able to overcome the most partisan differences – the role of the SEC and federal preemption – or that Sen. Brown (D-OH) will agree to yet another regulatory role for the Fed even if he does decide to advance a bill in this arena.

CRYPTO44.pdf…

28 03, 2023

DAILY032823

Eliza Allen2023-03-29T12:03:14-04:00March 28th, 2023|2- Daily Briefing|

CFPB Expands Scope of State Law

Reaffirming its preliminary determination, the CFPB today concluded that business-loan disclosure laws in several states are not preempted by TILA. This continues the Bureau’s reversal of prior preemption determinations from the OCC that gave national banks considerable protection from more stringent state standards. The grounds on which the CFPB did so in this case are that TILA is expressly intended for consumers and those state laws now allowed to stand cover businesses and “entrepreneurs” who are not consumers.

Global Regulators to Review Resolution Process

In an unusual plenary statement following a previously-scheduled meeting today, FSB members stated that recent events warrant review of the global resolution framework. The statement is brief and does not indicate how or when this might proceed, but – as noted in our previous report on CS-s failure’s fallout (see Client Report GSIB21), we expect a hard look at TLAC as well as renewed interest in ring-fencing.

Daily032823.pdf…

1 03, 2023

DAILY030123

Eliza Allen2023-03-01T16:38:23-05:00March 1st, 2023|2- Daily Briefing|

What’s Next For McHenry Privacy Bill

As we anticipated yesterday, HFSC reported H.R. 1165, Chairman McHenry’s privacy bill, on a party-line vote of 26-21. Discussions this morning lead us to conclude that Mr. McHenry plans to consider additional changes that could be made via a manager’s amendment when bringing the bill to the House floor given that its fate there is uncertain given the GOP’s slim majority.

CFPB Targets Public-Benefits Finance

The CFPB today published a “spotlight” examining numerous fees it says “erode” public benefit programs delivered through various financial products. Focusing in particular on prepaid cards, the spotlight states that the Bureau will monitor and may take action against entities violating consumer protection laws in the delivery of cash assistance. This comes following a major enforcement action in this area against Bank of America and reports of others pending against large banks.

Treasury Sets Out Steps Seemingly Towards A U.S. CBDC

Following up the President’s executive order on digital assets (see Client Report CRYPTO26) and Treasury’s subsequent report (see Client Report CBDC14), Under-Secretary Nellie Liang today outlined next steps leading to the Administration’s decision about CBDC benefits that will strongly guide the Fed’s CBDC final call. Ms. Liang details how CBDC and FedNow each have benefits, describing how CBDCs generally work and could function in the U.S.

Daily030123.pdf…

28 02, 2023

DAILY022823

Eliza Allen2023-02-28T17:16:34-05:00February 28th, 2023|2- Daily Briefing|

CFPB Treads Gingerly on Mortgage-Disclosure Exceptions

In a notice emphasizing the CFPB’s distaste for allowing regulatory exceptions, the Bureau asks for comment on an application for one to which it seems a bit more sympathetic.

FDIC Sees Sunny Side of Bank Earnings Data

In its review of banking-industry fourth-quarter results, the FDIC today notes a sharp increase in the gap between bank loan yield and deposit interest costs.

Basel Forecasts End-Game Capital Shortfalls

The Basel Committee today issued its latest monitoring report, finding that large global banks saw capital decreases to pre-pandemic levels even as liquidity ratios continued to improve.

Bipartisan China Bills Fly Through HFSC Markup

As anticipated, HFSC today reported five bills to censure China and protect Taiwan, along with bills addressing drug-trafficking financing, biomedical security and bank service company examinations.

Democrats Stand Firm versus Privacy Preemption

Following an orderly and bipartisan start to today’s HFSC markup, Democrats and Republicans today came to verbal blows over the Chairman’s data privacy bill.

Daily022823.pdf…

7 12, 2022

DAILY120722

Eliza Allen2022-12-07T17:42:12-05:00December 7th, 2022|2- Daily Briefing|

Gensler Stands by Enforcement-Focused Crypto Policy

In an interview today, SEC Chairman Gensler fiercely defended the Commission’s crypto enforcement history and attacked crypto exchanges, calling them “casinos” that fought to skirt investor-protection law rather than come into compliance. Rebuking calls from Sen. Warren (D-MA) for increased SEC crypto attention, he argued that the Commission is committed to regulating crypto securities and has already filed an abundance of enforcement actions.

CFPB Demurs on Key Preemption Decisions

Signaling an aversion to Federal preemption long sought by consumer advocates, the CFPB has made a preliminary determination that a New York State law that requires commercial financing disclosures is not preempted by TILA. It has also reached an initial decision that similar laws in California, Utah, and Virginia are also not preempted, reflecting the importance of this decision.

Dems Demand De-Risking Rewrite

A day after a senior Treasury official chastised banks for failing to de-risk on a risk-based methodology, Sen. Warren (D-MA), Rep. Omar (D-MN), and a group of Democratic Members of Congress wrote Secretary Yellen, FinCEN, and the banking agencies seeking an update on ways to ensure that AML compliance does not adversely affect Muslim and immigrant communities. Noting that a recent increase in sanctions also has led banks to de-risk charities, the Members point to resulting humanitarian problems due to lost aid.

Daily120722.pdf…