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 April 15, House of Representatives document repository published a new draft bill that would establish a potential statutory framework for payment stablecoins. On April 19, the House of Representatives Committee on Financial Services will hold a hearing on “Understanding Stablecoins’ Role in Payments and the Need for Legislation.” For more information about the draft bill, click here. For information about the legislative hearing, click here.
• On April 14, the Securities and Exchange Commission reopened the comment period and provided supplemental information on proposed amendments to the definition of “exchange” under the Exchange Act Rule 3b-16. Notably, the reopening release suggested that decentralized finance exchanges “could meet the existing the criteria of Exchange Act Rule 3b-16(a).” For more information, click here.
• On April 14, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated two entities in the People’s Republic of China (PRC) and five individuals based in the PRC and Guatemala for supplying precursor chemicals to Mexican drug cartels to produce illicit fentanyl intended for U.S. markets. OFAC also designated a bitcoin address used to accept funds to sell fentanyl precursor chemicals made in China. For more information, click here.
• On April 14, the Consumer Financial Protection Bureau announced a revised version of its “Methodology for Determining Average Prime Offer Rates,” describing the calculations used to determine average prime offer rates for purposes of federal mortgage rules. For more information, click here.
• On April 12, the attorneys representing defunct cryptocurrency exchange FTX in its bankruptcy proceeding announced that FTX recovered approximately $7.3 billion in liquid assets and would consider reopening for business in Q2 2024. For more information, click here.
• On April 12, U.S. Court of Appeals for the Fourth Circuit held that the Military Lending Act (MLA) does not govern loans borrowed in part to finance the purchase of a car, even when the loan covers additional related costs. The district court disagreed and dismissed the case, ruling that the plaintiff’s contract was exempt from the MLA because guaranteed asset protection coverage and other add-on charges were “inextricably tied” to his purchase of the car. For more information, click here.
• On April 12, the U.S. Small Business Administration published a final rule in the Federal Register, lifting the moratorium on licensing new nondepository small business lending companies (SBLCs) and adding a new type of entity called a “community advantage SBLC.” For more information, click here.
• On April 12, the Federal Trade Commission (FTC) and the state of Florida filed suit against Chargebacks911 for allegedly unfairly thwarting consumers who tried to dispute credit card charges through the chargeback process. The FTC and Florida claimed that since at least 2016, the “chargeback mitigation” company and its owners Gary Cardone and Monica Eaton Cardone used multiple unfair techniques to prevent consumers from successfully winning chargeback disputes. For more information, click here.
• On April 11, the FTC announced the creation of Project Point of No Entry, charging VoIP providers used as “point of entry” or “gateway” with eliminating the bad actors’ abilities to deliver calls to consumers in the U.S. For more information, click here.
• On April 11, the Bank of International Settlements published “Stablecoins versus tokenized deposits: implications for the singleness of money.” The bulletin discusses the concept of “singleness of money,” which ensures that monetary exchange is not subject to fluctuating exchange rates between different forms of money, and how payment stablecoins, the prices of which can fluctuate momentarily, do not align with this concept. For more information, click here.
• On April 10, President Joe Biden signed HJR7 into law, declaring the end of the COVID-19 emergency installed on March 13, 2020. The FCRA amendments under the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act will now terminate 120 days after this date. For more information, click here.
• On April 10, Vice President Kamala Harris and Deputy Secretary of the Treasury Wally Adeyemo announced that the U.S. Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund awarded over $1.73 billion in grants to 603 CDFIs nationwide through the CDFI Equitable Recovery Program. These funds will strengthen the ability of CDFIs to help low- and moderate-income communities recover from the COVID-19 pandemic and invest in long-term prosperity. For more information, click here.
• On April 7, U.S. Department of Housing and Urban Development issued Mortgagee Letter 2023-08, which extends the final date for borrowers to request COVID-19 forbearance and home equity conversion mortgage extensions through May 31. For more information, click here.

State Activities:

• On April 4, Tennessee Governor Bill Lee signed HB 316/SB 268, enacting the state’s Money Transmission Modernization Act (MTMA). The MTMA seeks to (1) promote coordination among the states in all areas of regulation, licensing, and supervision to reduce regulatory burden and more effectively utilize regulator resources; (2) protect the public from financial crime; (3) standardize the types of activities subject to licensing or otherwise exempt from licensing; and (4) modernize safety and soundness requirements to ensure customer funds are protected in an environment that supports innovative and competitive business practices. In addition, the MTMA establishes the standards related to money transmitter licensees’ examinations and how the DFI commissioner should handle certain confidential information. The law also authorizes the DFI commissioner to use the national multistate licensing system and registry for all aspects of licensing and requires licensees to advise consumers of DPI’s contact information for questions or complaints about a licensee. For more information, click here.