Washington Report 360 | May 06, 2022

Key Highlights

• Community Reinvestment Act. The FRB, OCC, and FDIC propose rules to amend the Community Reinvestment Act regulations, including provisions that would broaden assessment areas based on bank activity (versus bank physical locations) as well as the addition of “disaster preparedness and climate resiliency activities” within the community development activities definition.
• Environmental Justice. DOJ launches a new comprehensive environmental justice strategy and a new Office of Environmental Justice to prioritize enforcement, especially with regard to climate and related impacts on communities of color, indigenous communities, and low-income communities. 
• Crypto and Cyber Risks. The SEC nearly doubles the staffing of the Crypto Assets and Cyber Unit within its Division of Examination.
• Diversity, Equity, and Inclusion: SEC summarizes that its Diversity Assessment Report, based on voluntary self-assessments from registered entities, highlights diversity policies and practices strengths and opportunities for improvement.

Financial services regulatory and policy news

Banking

• Interagency:
  • The FRB, OCC, and FDIC issued a joint proposal to amend the implementing regulations to the Community Reinvestment Act; related statements here and here
• FRB
  • Spoke on variation in the inflation experiences of households
  • Issued its Supervision and Regulation report focusing on the second half of 2021
• FDIC
  • Launched its 2022 Small Business Lending Survey

• CFPB:
  • Published the Spring 2022 issue of its supervisory highlights covering examinations during the second half of 2021
  • Published blogs on Overcharging for add-on products on auto loans, How to prevent and report scams targeting older adults, Exams leading to remediation for private student loan servicers’ unfair practices, and Credit reporting companies and furnishers obligations to assure accuracy in consumer reports

Capital Markets

• SEC:
  • Expanded the staffing of the Crypto Assets and Cyber Unit in its Division of Examination
  • Published a Diversity Assessment Report that analyzes voluntary self-assessments provided by regulated entities
  • Division of Corporation Finance posted a sample letter to companies regarding disclosures pertaining to the Russia-Ukraine war and related supply chain issues
  • Provided remarks at the Small Business Capital Formation Advisory Committee Meeting; Commissioner remarks here and here
  • Spoke before the Conference on Financial Market Regulation
• FINRA:
  • Published the 2022 FINRA Industry Snapshot

Other

• Administration
  • Issued a national security memorandum on promoting U.S. leadership in quantum computing while mitigating risks to vulnerable cryptographic systems and related fact sheet
• Treasury:
  • OFAC announced Russia-Ukraine-related updates, including amendments to the Ukraine-Related Sanctions Regulations and Associated Administrative List; new General License 30; and new FAQs
  • OFAC issued first ever sanctions on a virtual currency mixer 
  • FinCEN renewed and expanded its Real Estate Geographic Targeting Orders, which require U.S. title companies to identify natural persons behind shell companies
• U.S Congress:
  • Senate Banking Committee:
    • Held a hearing to examine overdraft fees and their impact on working families
    • Held a hearing to examine student loan servicers and their impact on workers
• Department of Justice:
  • Announced the launch of a comprehensive environmental justice strategy
• FHFA:
  • Announced mandatory use of the supplemental consumer information form
• BIS:
  • Published results of the 2021 BIS Survey on Central Bank Digital Currencies
  • Published a research paper on the design of a data governance system

Industry news headlines

(Some links may require subscription)

Crypto suspicious activity reports are climbing. Here's why. (American Banker)

A chip crisis is looming for payment cards (American Banker)

Pandemic shows risks posed by nonbanks: Yellen (American Banker)

FBI Conducted Potentially Millions of Searches of Americans’ Data Last Year, Report Says (WSJ)

Wall Street Reluctantly Embraces Crypto (WSJ)

Banks gearing up to test real-time payments across borders (American Banker)

U.S. "open banking" rule bogged down by privacy concerns - sources (Reuters)

Fraud is down, but more expensive (American Banker)

Fed, Biden Administration Float New Lending Rules for Lower-Income Areas (WSJ)