To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week.
Federal Activities
State Activities
Federal Activities:
On September 29, Swift announced a groundbreaking initiative to integrate a blockchain-based shared ledger into its infrastructure, aiming to revolutionize global finance by enabling real-time, 24/7 cross-border transactions across more than 200 countries and territories. Collaborating with more than 30 financial institutions and Consensys, Swift will develop a conceptual prototype of the ledger, focusing on leveraging its unmatched resiliency, security, and scalability to facilitate transactions using regulated tokenized value. This initiative is part of Swift’s broader strategy to enhance the payments experience by upgrading existing rails and creating future digital rails, ensuring interoperability across both private and public networks. For more information, click here.
On September 26, Commissioner Hester M. Peirce delivered a speech at the Coin Center Dinner in Washington, D.C., humorously reflecting on her tenure at the Securities and Exchange Commission (SEC) and her future plans post-SEC. She expressed a desire for a regulatory environment that allows innovation without heavy oversight, joking about her potential career paths, including beekeeping and becoming an NFT creator. Peirce critiqued past SEC approaches to digital assets and emphasized the importance of regulatory clarity. She acknowledged the contributions of the crypto community in advancing technology and urged them to continue building valuable projects that enhance societal well-being. For more information, click here.
On September 26, the Federal Deposit Insurance Corporation (FDIC) announced the appointment of five individuals to senior leadership positions. Ryan Billingsley was named director of the Division of Risk Management Supervision, bringing extensive experience from both the private sector and previous roles within the FDIC. Matthew Reed was appointed as general counsel, leveraging his background in legal and regulatory roles across various federal agencies. Alex LePore was appointed deputy to the chairman for policy, continuing his advisory role on regulatory initiatives. Mark Handzlik was named special advisor to the chairman, providing strategic counsel on policy issues. Lastly, Dan Marcotte was appointed as FDIC ombudsman, drawing on his 35-year tenure with the FDIC to serve as a liaison for resolving issues related to the agency’s activities. For more information, click here.
On September 25, the Consumer Financial Protection Bureau (CFPB) published a final rule in the Federal Register rescinding amendments made in 2022 and 2024 to the Procedures for Supervisory Designation Proceedings, effective October 27. This decision restores the 2013 rule, which treats decisions and orders as confidential supervisory information, addressing concerns about reputational harm and competitive disadvantage from public disclosures. The CFPB retains some process adjustments from the 2024 rule, such as allowing video-conducted supplemental oral responses and simplifying voluntary consent agreements. The CFPB’s decision follows public comments and aims to balance transparency with protecting entities from undue reputational pressure. For more information, click here.
On September 23, Acting Chairman of the Commodity Futures Trading Commission (CFTC) Caroline Pham announced the launch of an initiative focused on the use of tokenized collateral, including stablecoins, in derivatives markets. This initiative is part of the CFTC’s broader efforts to implement recommendations from the report authored by the President’s Working Group on Digital Asset Markets. The CFTC’s initiative aims to modernize collateral management and enhance capital efficiency in derivatives markets through the use of tokenized collateral. The CFTC’s Global Markets Advisory Committee has previously recommended expanding the use of non-cash collateral through distributed ledger technology. This initiative seeks to implement those recommendations and provide regulatory clarity for digital asset markets. The CFTC is also considering a pilot program as a U.S. regulatory sandbox to further explore the potential of tokenized collateral in financial markets. Stakeholders are encouraged to submit their feedback by October 20. For more information, click here.
On September 23, the U.S. Department of Housing and Urban Development (HUD) issued a notice announcing changes to the mortgage insurance premiums (MIPs) applicable to Fair Housing Act (FHA) Multifamily Insurance Programs. The notice, which follows a presidential memorandum aimed at delivering price relief and addressing the cost-of-living crisis, reduces MIPs to 0.25% for all FHA multifamily programs and eliminates the MIP categories established in 2016, such as Green and Energy Efficient Housing, Affordable Housing, and Broadly Affordable Housing. These changes are intended to simplify the MIP structure, reduce financing costs, and stimulate rental housing development. The revised MIPs will apply to applications submitted or amended on or after October 1. HUD’s decision reflects a shift away from incentivizing energy-efficient building practices, citing market maturity and the need for a uniform rate to address current economic conditions. Public comments on the notice are open until October 1. For more information, click here.
On September 22, a press release announced that the chancellor of the Exchequer, Rachel Reeves, and U.S. Treasury secretary, Scott Bessent, convened at Downing Street to reinforce the enduring financial ties between the UK and the U.S. They agreed to establish a Transatlantic Taskforce for Markets of the Future, aimed at fostering collaboration on capital markets and digital assets. This initiative, reporting through the UK-U.S. Financial Regulatory Working Group, seeks to enhance cross-border market competitiveness and innovation by developing recommendations in partnership with industry leaders. The taskforce will explore both short-term and long-term strategies for digital asset collaboration and improving capital market links, with a report due in 180 days. For more information, click here.
On September 22, several members of Congress, including French Hill (R-AR) and Ann Wagner (R-MO), expressed their support for President Donald Trump’s Executive Order 14330, which aims to democratize access to alternative assets for 401(k) investors. The order encourages the inclusion of alternative investments in retirement plans when deemed appropriate by plan fiduciaries to enhance net risk-adjusted returns. It directs the secretary of labor to collaborate with the SEC to assess necessary regulatory changes. The letter urges the SEC to assist promptly and consider revising regulations to facilitate access to alternative assets, including reviewing bipartisan legislation related to accredited investors. The goal is to enable 90 million Americans to invest in alternative assets, thereby securing a more comfortable retirement. For more information, click here.
On September 19, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a proposed rulemaking to delay the implementation of the final rule that mandates Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) programs and Suspicious Activity Report (SAR) filing requirements for Registered Investment Advisers and Exempt Reporting Advisers. Originally set to take effect on January 1, 2026, the rule’s enforcement has been postponed to January 1, 2028. This decision follows an exemptive relief order issued by FinCEN on August 5, reflecting the agency’s intention to reassess and reopen discussions on the IA AML Rule. For further information, click here.
On September 18, the Federal Housing Finance Agency (FHFA) released an evaluation report highlighting improvements in coordination between the FHFA and Federal Home Loan Banks (FHLBanks) with federal and state regulators following the Spring 2023 bank failures. Despite these advancements, challenges remain, as several FHLBanks faced difficulties in obtaining timely supervisory information. The report identified that some FHLBanks received redacted reports of examination (ROEs) or were unable to access necessary supervisory information, impacting their decision-making on membership applications and lending. Additionally, seven state regulators did not share their ROEs, creating risk visibility gaps. The report also noted lapses in the FHLBanks’ receipt of material adverse event notifications, which are crucial for assessing members’ financial conditions. The FHFA made six recommendations to address these issues, all of which were agreed upon by FHFA management. For more information, click here.
On September 18, the U.S. Small Business Administration (SBA) announced a significant initiative to support small manufacturers by waiving most upfront loan fees for fiscal year 2026. This move aligns with the Trump administration’s efforts to revitalize American industrial strength by reducing financial barriers for small manufacturers, which constitute 98% of U.S. manufacturing businesses. The fee waiver applies to 7(a) manufacturing loans up to $950,000 and all 504 manufacturing loans, with both upfront and annual service fees set to 0%. Effective from October 1, 2025, through September 30, 2026, this initiative aims to empower small manufacturers to boost hiring, growth, and production, while also encouraging the reshoring of jobs and strengthening national supply chains. Additionally, the SBA introduced the Manufacturers’ Access to Revolving Credit (MARC) Loan Program, its first dedicated loan program for small manufacturers, to further facilitate access to capital. Small manufacturers are encouraged to use the SBA Lender Match portal to connect with lenders offering competitive rates. For more information, click here.
On September 17, Under Secretary for Terrorism and Financial Intelligence John K. Hurley addressed the Association of Certified Anti-Money Laundering Specialists Assembly Conference, emphasizing the need for modernization in the Bank Secrecy Act (BSA) to better combat money laundering and terrorist financing. Hurley highlighted the importance of providing law enforcement and national security with useful information rather than overwhelming them with unnecessary data. He discussed the challenges posed by current regulatory pressures, which lead to excessive and often unhelpful suspicious activity reports (SARs). Hurley outlined a vision for reform that prioritizes objective measures of output over subjective assessments, encourages technological innovation, and seeks to align financial and business interests with national security goals. He also mentioned recent changes, such as the FinCEN exemptive order, as steps toward a more efficient system. Hurley called for collaboration and input from the financial community to ensure reforms are effective and beneficial. For more information, click here.
On September 16 and 17, HUD issued two memoranda that clarify HUD’s role in enforcing the FHA, explain how future enforcement efforts will proceed, and officially rescind several guidance documents related to disparate impact and redlining, among other topics. The September 16 memorandum appears to be in direct response to Trump’s Executive Order 14281, “Restoring Equality of Opportunity and Meritocracy,” which aims to eliminate the use of disparate impact liability across federal agencies. HUD will now prioritize resources for cases with clear evidence of intentional discrimination. The memo criticizes previous enforcement strategies as “ideological” and inconsistent with federal law, suggesting that they have made housing more expensive and less fair. Both the September 16 and September 17 memoranda announced the withdrawal of numerous HUD’s Office of Fair Housing and Equal Opportunity guidance documents, including “Proving Disparate Impact in Fair Housing Cases After Inclusive Communities” (Aug. 1, 2016), “Referrals of Pattern or Practice Fair Housing Cases to the Department of Justice” (Dec. 12, 2011), and the “FHEO Statement on the Fair Housing Act and Special Purpose Credit Programs” (Dec. 7, 2021). For more information, click here.
On September 16, in an opinion piece for CoinDesk, Hill highlighted the pressing need for the U.S. to establish a comprehensive market structure for digital assets, cautioning that without such a framework, the U.S. risks losing its competitive edge to Latin America and Europe. Despite having the deepest liquidity in crypto markets, the U.S. has lagged behind in regulatory clarity, a gap partially addressed by the recent enactment of the GENIUS Act and the passage of the CLARITY Act through the House. Hill’s observations, drawn from meetings with global digital asset leaders, underscore the distinct paths taken by Latin America, Europe, and the U.S. in digital asset development. He emphasizes the necessity for the U.S. to implement a regulatory framework that fosters innovation while safeguarding consumers and investors, to maintain its leadership in the digital asset ecosystem. For more information, click here.
State Activities:
On September 23, the California Privacy Protection Agency (CPPA) announced that the California Office of Administrative Law has approved new regulations aimed at enhancing consumer privacy protections. These regulations cover areas such as cybersecurity audits, risk assessments, automated decision-making technology (ADMT), and updates to existing California Consumer Privacy Act (CCPA) regulations. The approval follows extensive engagement with industry stakeholders, civil society, and the public, including multiple hearings and the review of numerous public comments. The regulations, which take effect on January 1, 2026, are designed to provide clarity for businesses while ensuring robust privacy protections for Californians. Businesses will have additional time to comply with certain requirements, such as cybersecurity audits and ADMT, with deadlines extending into 2028 and 2029 depending on the business’s revenue. For more information, click here.
On September 22, California Governor Gavin Newsom signed Assembly Bill AB 238 into law, establishing protections for borrowers affected by disasters. The bill mandates that mortgage servicers report credit obligations of borrowers under disaster-related forbearance plans in compliance with the federal Fair Credit Reporting Act. It prohibits servicers from indicating forbearance status during the relief period and requires them to report accounts as current unless previously delinquent. Additionally, the bill forbids the imposition of late fees or default interest rates during forbearance and restricts foreclosure actions if borrowers adhere to forbearance terms. The Department of Financial Protection and Innovation (DFPI) is tasked with providing online resources, including servicing guidelines and assistance contacts, to support borrowers. For more information, click here.
On September 22, California Attorney General Rob Bonta, along with 19 other attorneys general, sent letters to the CFPB opposing proposals by the Trump administration that would significantly reduce the CFPB’s oversight of key financial markets, including auto finance, consumer reporting, debt collection, and international money transfers. These proposals aim to limit CFPB supervision to a small number of companies in each sector, potentially leaving consumers vulnerable to exploitation. Bonta criticized the administration’s efforts to weaken the CFPB, which was established to protect consumers from unfair practices and has returned over $20 billion to Americans. The attorneys general argue that the proposals violate the CFPB’s federal mandate to safeguard consumer interests and could lead to a substantial increase in unresolved consumer complaints. For more information, click here.
On September 18, the California DFPI issued a Desist and Refrain Order against Anh Management LLC, operating as Hermes Bitcoin, for violations of the California Consumer Financial Protection Law (CCFPL) and the Digital Financial Assets Law (DFAL). The order alleges that Hermes Bitcoin, which operates Bitcoin ATMs in California, engaged in unlawful practices by exceeding transaction limits, overcharging fees, failing to provide required disclosures, and neglecting to collect necessary customer identification information. These actions are said to contravene both state financial codes and federal anti-money laundering regulations. The commissioner has mandated Hermes to cease these practices and is pursuing ancillary relief and penalties, potentially amounting to $60,810,000, for the numerous violations cited. For more information, click here.
On September 17, California Governor Gavin Newsom signed Assembly Bill 144 (AB 144) into law, a move in response to recent changes in immunization recommendations by the U.S. Food and Drug Administration (FDA). Among other federal health policy changes, the FDA’s recent updates to COVID-19 vaccine approvals, limiting them to individuals 65 years and older or those with specific risk factors, prompted California to reassess its vaccine coverage policies. The bill, which took effect immediately, mandates that health plans cover a wide range of preventive care services, including immunizations, without cost-sharing or utilization management. AB 144 authorizes California public health officials to base immunization guidance on data from independent medical organizations rather than federal sources, and ensures that despite changes in federal policy, Californians continue to have access to and coverage for immunizations and other preventive care in line with California state recommendations. For more information, click here.
