Washington Report 360 | June 8, 2018

In this issue....

Key highlights

  • The federal financial regulatory agencies have submitted proposed amendments to the Volcker Rule for public comment following approval by all five agencies; the amendments would maintain the statutory ban on proprietary trading but streamline compliance requirements to account for a firm’s level of trading activity.
  • The CFPB dismissed its long-running case against a large mortgage servicer. The case was notable for the size of the assessed fines and for the associated court ruling upholding the CFPB’s structure as constitutional.
  • Jelena McWilliams was sworn in as Chairman of the FDIC; she is the last of the nominees to lead the federal financial regulatory agencies to be confirmed.

Financial services legislative and regulatory news

All five federal financial regulatory agencies have now approved the release of a joint proposal to amend the Volcker Rule.

The SEC voted to allow mutual funds to distribute fund shareholder reports electronically beginning in 2021 (new rule 30e-3).

The SEC provided no-action relief permitting mutual funds to temporarily delay the disbursement of redemption proceeds when there is a reasonable belief of financial exploitation of a senior or impaired adult.

The CFTC approved a final rule amending the swap data access provisions on indemnification and a proposed rule to amend the de minimis exception to swap dealer registration.

FINRA proposed to amend FINRA Rule 6730 to require TRACE reports to identify non-FINRA member subscribers, and also Rule 6433 to extend the Tier Size Pilot.

The OCC and the FDIC issued a final rule shortening the standard settlement cycle to an industry-wide two-business day settlement cycle.

The Federal Reserve Board will consider a final rule to establish single-counterparty credit limits on June 14.

Financial services policy news

News reports state the CFPB dismissed its case against a large mortgage servicer for alleged RESPA violations; a federal appeals court in January vacated the fine but upheld the CFPB's structure as constitutional.

Jelena McWilliams was sworn in for a five-year term as Chairman of the FDIC and a six-year term on its board of directors.

CFTC Chairman Christopher Giancarlo and SEC Chairman Jay Clayton each testified that cybersecurity risk management is a primary driver to their agency’s Congressional budget requests.

The Financial Stability Board issued a call for public feedback on the technical implementation of its Total Loss-Absorbing Capacity (TLAC) Standard.

The FSB requested feedback for its third thematic peer review on resolution planning for systemically important banks in FSB member jurisdictions.

The CFPB released a Complaint Snapshot highlighting debt collection complaints.

New reports indicate the CFPB has dismissed the members of its Consumer Advisory Board and Councils; the CFPB announced it will revamp these advisory groups with new and smaller memberships.