To help you keep abreast of relevant activities, below find a breakdown of some of the biggest events at the federal and state levels to impact the Consumer Finance Services industry this past week:

Federal Activities

State Activities

Federal Activities:

• On July 3, the Consumer Financial Protection Bureau (CFPB) will begin accepting membership applications for its advisory committees: the Consumer Advisory Board, the Community Bank Advisory Council, the Credit Union Advisory Council, and the Academic Research Council. To be considered for membership, the CFPB must receive your completed application packet on or before Sunday July 16. For more information, click here.
• On July 3, the Office of the Comptroller of the Currency (OCC) released a list of Community Reinvestment Act (CRA) performance evaluations that became public during the period of June 1 through June 30. The list contains only national banks, federal savings associations, and insured federal branches of foreign banks that have received ratings. Of the 19 evaluations made public this month, 14 are rated satisfactory, four are rated outstanding, and one needs to improve. For more information, click here.
• On June 30, the Commodity Futures Trading Commission (CFTC) announced new members and leadership of the Global Markets Advisory Committee (GMAC) and its corresponding subcommittees on global market structure, technical issues, and digital asset markets. There are currently 128 members across GMAC and its subcommittees, which is the largest-ever single advisory committee initiative sponsored by the CFTC. For more information, click here.
• On June 29, the United Kingdom’s cryptocurrency bill — the Financial Services and Markets Act 2023 — was approved by King Charles and ratified into law. Under the law, the Treasury, Financial Conduct Authority, Bank of England, and Payments Systems Regulator will be granted the authority to establish and enforce regulations for crypto businesses. Notably, cryptocurrencies will be subject to the same regulations as traditional assets. For more information, click here.
• On June 29, the Federal Financial Institutions Examination Council announced the availability of data on 2022 mortgage lending transactions reported under the Home Mortgage Disclosure Act (HMDA) by 4,460 U.S. financial institutions, including banks, savings associations, credit unions, and mortgage companies. The HMDA data are the most comprehensive publicly available information on mortgage market activity. The data are used by industry, consumer groups, regulators, and others to assess potential fair lending risks and for other regulatory and informational purposes. The data help the public assess how financial institutions serve the housing needs of their local communities and facilitate federal financial regulators’ fair lending, consumer compliance, and Community Reinvestment Act examinations. For more information, click here.
• On June 29, the OCC, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, and National Credit Union Administration jointly issued a final policy statement on commercial real estate loan accommodations and workouts. The statement includes a section on short-term loan accommodations not included in the previous guidance. An accommodation includes an agreement to defer one or more payments, make a partial payment, or provide other assistance or relief to a borrower experiencing a financial challenge. Additionally, the statement addresses recent accounting changes for estimating loan losses and provides examples of how to classify and account for loans affected by workout activity. For more information, click here.
• On June 28, the European Central Bank (ECB) published its legislative proposal on the digital euro. According to the proposal, “private intermediaries [will be offered] appropriate economic incentives to distribute the digital euro as they do other digital means of payment, while preventing excessive fees for merchants.” For more information, click here.
• On June 28, Mastercard announced that it intends to launch the beta version of its permissioned blockchain network — Multi-Token Network (MTN) — this summer. MTN is built on the Ethereum network, and Mastercard has encouraged developers to build apps of MTN. According to Mastercard, the first round of apps built on MTN will be powered by tokenized bank deposits. For more information, click here.
• On June 28, the CFPB published a blog written by its Office of Research, examining how mortgages with a COVID-19-related forbearance, granted under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, performed in 2023. For more information, click here.
• On June 27, the CFPB issued an order against ACI Worldwide and one of its subsidiaries, ACI Payments, for improperly initiating approximately $2.3 billion in unlawful mortgage payment transactions. The order requires ACI to pay a $25 million civil money penalty. For more information, click here.
• On June 27, the OCC reported an improvement in the performance of first-lien mortgages in the federal banking system during the first quarter 2023 compared to the previous quarter. The OCC Mortgage Metrics Report, First Quarter 2023 showed that 97.6% of mortgages included in the report were current and performing at the end of the quarter, compared with 97.1% in the fourth quarter 2022. There was also an improvement compared to first quarter 2022 when 96.9% of mortgages were current and performing. For more information, click here.

State Activities:

• On June 28, Connecticut Governor Ned Lamont signed SB1032, an act that will require certain providers of commercial financing to make various commercial financial disclosures, authorize the banking commissioner to adopt regulations concerning such disclosures, and establish civil penalties for violations of such commercial financing disclosure requirements. The act defines “commercial financing” as “any extension of sales-based financing by a provider in an amount not exceeding [$250,000], the proceeds of which the recipient does not intend to use primarily for personal, family, or household purposes.” The act permits a provider to rely on any statement of intended purpose made by a recipient for purposes of determining whether the requested financing is commercial financing. The act also requires a provider to furnish certain disclosures to a recipient at the time the provider extends a specific offer for sales-based financing, which will include, among other things: (1) the total amount of the commercial financing; (2) the disbursement amount (amount to be paid to recipient, excluding any finance charges deducted or withheld at disbursement); (3) the finance charge; (4) the total repayment amount, (5) the estimated time period for payoff; (6) payment amounts (the payment amount and frequency, if payment is fixed, or the payment schedule or description of the method used to calculate the amount and frequency of payment, along with average projected payments per month, if payments are variable); and (7) a description of all other potential fees and charges not included in the finance charge. For more information, click here.
• On June 27, Florida Governor Ron DeSantis approved H27. Also known as the Judgment Lien Improvement Act, the bill will do the following:
  • Requires judgment lien holders to notify the Department of Highway Safety and Motor Vehicles in writing of its desire to place a lien on a motor vehicle or vessel and include a copy of the judgment lien certificate;
  • Requires judgment lien holders to use the judicial process for enforcing judgment liens and prohibits self-help actions;
  • Requires a lapse in the judgment lien to receive the same treatment as a lien satisfaction; and
  • Clarifies that a properly obtained judgment lien is valid and enforceable against a judgment debtor even if the lien is not yet noted on the certificate of title.

The bill becomes effective on July 1. For more information, click here.

• On June 27, California Attorney General Rob Bonta released a statement following the Assembly Judiciary Committee’s vote to approve SB680. The bill targets social media companies that generate over $100 million in gross revenue during the preceding calendar year and creates accountability for the harm those companies cause to child users on their platforms. Specifically, the bill would prohibit the social media companies from knowingly or negligently using a design, algorithm, or feature that the company knew, or should have known, causes child users to experience addiction to the social media platform, develop an eating disorder, or inflict harm on themselves or others. Additionally, under the bill’s provisions, the social media companies could be held liable for sending child users information about how to obtain firearms, controlled substances, or accomplish death by suicide, if the child acts on that information. The bill authorizes the AG’s office, and other public prosecutors, to enforce its provisions, and provides for a civil penalty of up to $250,000 for knowing and willful violations of its provisions. For more information, click here.
• On June 26, Connecticut Governor Ned Lamont signed SB1058, a comprehensive act that addresses issues concerning charitable organizations, telecommunications, and the Colorado AG’s recommendations regarding consumer protections. The act includes a new section that penalizes, by a fine of up to $20,000 per violation, a person who assists or supports initiators of voice communication or telephonic sales whom the person providing assistance knows, or avoids knowing, is engaged in conduct prohibited by the act. The act also restricts the allowable call window by an hour, requiring calls to be completed by 8 p.m., instead of 9 p.m. Additionally, persons who initiate a telephonic sales call must, within 10 seconds of the call, disclose their identity, the purpose of the call, and the identity of the entity for whom the call is being made. The caller must also ask whether the person being contacted wishes to continue the call, end the call, or be removed from the call list. A call must be ended within 10 seconds of a consumer indicating a desire to end the call. Additionally, if a consumer indicates that he or she wants no future contact, the caller must: (1) confirm for the consumer that his or her contact information will be removed; (2) end the call within 10 seconds of the consumer indicating such desire; (3) refrain from making any calls to the consumer on any telephone number associated with the consumer; and (4) refrain from disclosing or selling the consumer’s name or other contact information to any other entity. The act also requires a consumer’s express written consent before an initiator can contact the consumer on the consumer’s mobile telephone or mobile electronic telephone number for the purpose of marketing, selling, or soliciting sales of consumer goods. The act will go into effect October 1. For more information, click here.
• On June 26, the Nevada Financial Institutions Division filed a temporary restraining order (TRO) against crypto-driven financial institution Prime Core Technologies, Inc. (Prime Core) and its subsidiaries. The TRO prohibits Prime Core from operating as a retail trust company and requests an order appointing a receiver over Prime Core for the purpose of its conservation or rehabilitation. In 2018, Prime Core began providing crypto custody services to its clients. The TRO alleges that present day, Prime Core owes $85,766,000.00 to its clients, but only has $2,904,000.00 in assets. For more information, click here.