Like most industries today, Consumer Finance Services businesses are being significantly impacted by the novel coronavirus (COVID-19). Troutman Pepper has developed a dedicated COVID-19 Resource Center to guide clients through this unprecedented global health challenge. We regularly update this site with COVID-19 news and developments, recommendations from leading health organizations, and tools that businesses can use free of charge.

To help you keep abreast of relevant activities, below find a breakdown of some of the biggest COVID-19 driven events at the federal and state levels to impact the Consumer Finance Services industry this past week:

Federal Activities

State Activities

Privacy and Cybersecurity Activities

Federal Activities:

• On March 17, the Senate Committee on Banking, Housing, and Urban Affairs conducted a hearing titled, “Understanding the Role of Digital Assets in Illicit Finance,” which focused extensively on whether and how Russia could use digital assets to avoid sanctions, as well as how Ukraine is using cryptocurrency to support its fight against Russia. For more information, click here.

• On March 17, Senators Elizabeth Warren, Jack Reed, Mark Warner, and Jon Tester introduced the Digital Asset Sanctions Compliance Enhancement Act to ensure that Vladimir Putin and Russian elites do not use digital assets to undermine the international community’s economic sanctions against Russia, following its invasion of Ukraine. Senators Tammy Duckworth, Debbie Stabenow, Raphael Warnock, Chris Van Hollen, Tina Smith, Catherine Cortez Masto, and Bob Menendez co-sponsored the legislation. For more information, click here.

• On March 16, the Consumer Financial Protection Bureau (CFPB) announced changes to its supervisory operations to better protect families and communities from illegal discrimination. In the course of examining banks’ and other companies’ compliance with consumer protection rules, the CFPB will scrutinize discriminatory conduct that violates the federal prohibition against unfair practices. The CFPB will closely examine financial institutions’ decision-making in advertising, pricing, and other areas to ensure that companies appropriately test for and eliminate illegal discrimination. For more information, click here.

• On March 15, the Federal Trade Commission (FTC) filed an administrative complaint against an electronic payment company for allegedly opening credit card processing merchant accounts for fictitious companies on behalf of a business opportunity scam that the FTC previously sued. By ignoring warning signs that the merchants were fake, millions of dollars of consumers’ credit card payments were laundered to the scammers from 2012 to 2013. For more information, click here.

• On March 11, Britain, Canada, France, Germany, Italy, Japan, and the United States (collectively, the G7) announced more sanctions against Russia, including first-time sanctions specific to virtual assets. The White House also announced that the Department of the Treasury would issue “new guidance [that] will continue to make clear that Treasury’s expansive actions against Russia require all U.S. persons to comply with sanctions regulations regardless of whether a transaction is denominated in traditional fiat currency or virtual currency.” Later that night, the Treasury Department issued another set of frequently asked questions, unequivocally stating that “Russia-related sanctions extend to virtual currency.” For more information, click here.

• On March 8, the U.S. Federal Reserve Banks launched the FedNow Service Provider Showcase to show financial institutions and users the various services to assist them in implementing the FedNow Service. The FedNow Service is an instant payment service to provide all depository institutions in the United States with access to instant payment services in near real-time every day of the year, including weekends and holidays. Currently, the Fed expects to release the FedNow Service in 2023, although in phases. For more information, click here.

• On March 7, following the significant sanctions and other restrictions imposed by the United States and its global allies resulting from the Russian Federation’s invasion of Ukraine, the Financial Crimes Enforcement Network issued an alert, advising financial institutions on how to identify and report potential attempts to evade sanctions. For more information, click here.

• The Board of Governors of the Federal Reserve System recently issued a supplemental notice and request for comment to the May 2021 proposed guidelines used by Federal Reserve Banks (Reserve Banks) in evaluating requests to access Federal Reserve accounts and payment services, in an effort to ensure that Reserve Banks use a transparent and consistent set of factors when reviewing such requests. For more information, click here.

State Activities:

• On March 15, Washington, DC’s City Council held a mark-up on council bill 240357. Among other provisions, the bill would “include all consumer debt under the District’s collection law and prohibit deceptive behavior and certain threats from debt collectors” and “requirements for debt collectors initiating a cause of action against a consumer for consumer debt.” The bill further “establishes debt collection protections during a public health emergency declared by the Mayor.” For more information, click here.

• On March 15, Georgia Attorney General Chris Carr issued a press release, recognizing March 13-19 as National Sunshine Week and reinforcing the importance of continuing to operate openly and transparently to all public officials. “We take very seriously our long-standing role in defending and protecting open government in Georgia,” said Carr. “Government officials are simply trustees of the people’s documents. Ensuring access to government records and meetings is essential to keeping the public informed and holding elected officials accountable.” The press release also instructed Georgia’s citizens how to make an open records request. For more information, click here.

• On March 14, Texas Attorney General Ken Paxton joined 20 other states in filing an amicus brief in the Sixth Circuit Court of Appeals to support Kentucky’s multistate coalition, challenging the federal vaccine contractor mandate. According to the press release, the brief “urges affirmance of the district court, which ruled that President Biden exceeded his authority by issuing the Executive Order under the authority of a statute passed in the wake of World War II to streamline federal property management.” Further, the press release states that the federal contractor vaccine mandate “improperly intrude upon the states’ powers and prerogatives.” For more information, click here.

Privacy and Cybersecurity Activities:

• On March 16, the National Institute of Standards and Technology (NIST) published a new cybersecurity practice guide titled, Protecting Information and System Integrity in Industrial Control System Environments: Cybersecurity for the Manufacturing Sector. This guidance specifically focuses on “industrial control systems,” which include the networks, devices, controls, and systems used to monitor and control industrial machinery. In the guide, NIST notes that the network integration of these systems has made them more vulnerable to cyberattacks. The guide also discusses cybersecurity benefits associated with numerous commercially available technologies, including technologies that can help manufacturers monitor network traffic to these systems and prevent unauthorized software installation. For more information, click here.

• On March 14, the Iowa House of Representatives passed H-8157, a comprehensive privacy law, with near-unanimous consent. This law is very similar to the Utah Consumer Privacy Act (UCPA), which is widely considered as more business-friendly than the privacy regimes enacted in other states, including the California Consumer Privacy Act (CCPA) and Virginia Consumer Data Protection Act (VCDPA). Notably, unlike many other state privacy laws/bills, H-8157 does not provide consumers with a right to correct their personal information. If adopted, this legislation would take effect on January 1, 2024. Iowa’s Senate Judiciary Committee is now considering H-8157, with its state legislative session ending on April 19. For more information, click here.