Financial Services Spotlight

October and November Developments

Posted by Roy Andersen on Dec 8, 2017 8:40:22 AM

Overview

For the first time in my memory, the Congress passed a joint resolution to disapprove a final regulation of a federal agency—in this case the CFPB and the rule was related to arbitration clauses in contracts for consumer financial products. In addition, the agencies amended certain definitions under CRA and these changes should be reflected in CRA policies and procedures at banks. Both the OCC and FDIC published final rules on requirements for Qualified Financial Contracts and introduced required language for larger banks.

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Topics: FDIC, Qualified Financial Contracts, CFPB, QVC, Mortgage Servicing

January 2017 Developments

Posted by Roy Andersen on Jan 31, 2017 12:00:00 PM

Overview

A Donald Trump effect was apparent with the January 26th Federal Register-- it was one of the shortest Federal Register volumes seen in some time—even the pre-holiday Registers sport more pages.  The CFPB published a rule requiring incentive programs for sales of consumer products be subject to extraordinary controls adapted to such sales campaigns.  These would be in addition to and perhaps duplicative of the requirements of primary federal regulators. 

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Topics: Sudan Sanctions, CFPB, Incentive Sales Programs, OFAC, Loss Absorbing Capacity, CFTC

July 2016 Second Half Developments

Posted by Roy Andersen on Jul 27, 2016 12:00:00 PM

Overview

The CFPB has issued its proposed regulations to regulate payday loans and other similar high cost extensions of credit. An extensive study of these types of loans revealed that there were some unfair and deceptive practices and a lack of focus on whether the consumers had the wherewithal to repay these loans on schedule without continuing to renew such credits.

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Topics: Transnational Criminal Organizations, Daylight Overdrafts, Payday Loans, CFPB, Home Mortgage Data

July 2016 First Half Developments

Posted by Roy Andersen on Jul 18, 2016 12:00:00 PM

Overview

The CFPB has issued its regulations to implement one of the few legislative changes to ease the compliance burden on banks.  The privacy rules have produced one of the least helpful disclosure requirements on how banks treat your confidential information.  Most consumers received rafts of these confusing disclosures to no useful end, except to trip up banks at examination time.  These were so burdensome that Congress actually provided some relief.  The CFPB rule demonstrates how confusing and overlapping rules are since the bulk of the rule is to ease interactions with other disclosure rules that intersect with the privacy notices.  The CFPB also published a special report on the mortgage servicing business highlighting the compliance problems in that business and suggesting that a crackdown was coming.

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Topics: Mortage Servicing, Regulation P, OFAC, CFPB, Penalty Calculations

May 2016 Second Half Developments

Posted by Roy Andersen on May 31, 2016 12:00:00 PM

Overview

The CFPB has issued a proposed rule that would restrict the use of mandatory arbitration in consumer finance contracts.   Arbitration is generally more expensive for consumers and eliminates the chance for class actions.  The proposed rule would cover a broad range of financial products.  The CFTC has issued its final rule on cross-border application of its margin rules on uncleared swaps. One Commissioner described the new rule as “muddled methodology” as well as impractical and unnecessary and harmful to US businesses. 

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Topics: Iraq, Burma, CFPB, Arbitration Agreements, Margin Requirements

April 2016 Second Half Developments

Posted by Roy Andersen on May 5, 2016 12:00:00 PM

Overview

The President issued an order subjecting certain Libyan persons to asset blocking and travel restrictions due to the deteriorating conditions in Libya.  OFAC will most likely update its sanctions to reflect the President’s actions. 

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Topics: NCUA, RESPA, Libya, OFAC, Mortgage Servicing, Regulation Z, CFPB

April 2016 First Half Developments

Posted by Roy Andersen on Apr 16, 2016 12:00:00 PM

Overview

Crowdfunding portals will have to do AML checks on the investors in such proposed financings.  The parties offering such services will be defined as brokers or dealers in securities for AML purposes.  OFAC is imposing new sanctions rules on Hizballah and on the country of Burundi.

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Topics: South Sudan, SDN List, Hizballah, Somalia, Burundi, CFPB, Liquidity Ratios

February 2016 Second Half Developments

Posted by Roy Andersen on Feb 29, 2016 12:00:00 PM

Overview

Old acronyms die hard.  No less an authority than a senior attorney at the Federal Reserve Bank of New York advised me that no one calls the Bureau of Consumer Financial Protection the BCFP—even though this is what it is called in the Dodd-Frank Act.  Instead, even the agency refers to itself as the CFPB.  Accordingly, we will get in step for future entries, as we have with the Met Life Building, the Ed Koch Bridge, and Kennedy Airport.  A rose by any other name would smell as sweet.  The OCC continues to study its leveraged lending guidelines.   Foreign swap transactions executed in the U.S. will benefit from some exemptions.  The healthy dividend paid by the Fed to the member banks will be cut back based on new law adopted in January.  

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Topics: Dodd-Frank, BCFP, CFPB, Foreign Transactions, OCC, Leveraged Lending, No-Action Letters, Reserve Banks, Libya, Cuba

About the Spotlight


The Financial Services Spotlight examines the regulatory and technology developments impacting banks, asset managers and other financial services providers—where challenges meet opportunities.

The material on this site is for general information only and is not legal advice. No liability is accepted for any loss or damage which may result from reliance on it. Always consult a qualified lawyer about a specific legal problem.

 

Meet the Authors


Roy C. Andersen, of counsel in Sullivan & Worcester's New York office, is a member of the Corporate Department. Mr. Andersen focuses on bank regulatory and compliance matters, including international banks and their branches and agencies in New York.

Joel Telpner, partner in the firm's New York office, is a seasoned advisor, strategist and problem solver. Mr. Telpner brings more than 30 years of legal experience in a career that includes time as an AmLaw 100 partner, the former U.S. general counsel of a global financial institution, and a venture capitalist. He is recognized for his ability to deftly manage complex financial transactions, especially those involving sophisticated structured finance and derivatives matters and has an extensive and unique combination of transactional and regulatory experience.

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