CFPB Director Cordray to Resign
CFPB Director Richard Cordray announced his plans to resign today in an email to CFPB employees, writing that he expects “to step down from my position here before the end of the month.” Rumored to be a Democratic candidate for governor in his home state of Ohio next year, Director Cordray did not elaborate on his future plans. After waiting 10 long months, President Trump will now have the opportunity to nominate a new CFPB director.
On November 8, the FRB and the CFPB jointly announced the new dollar thresholds that will determine exemption from Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing) for consumer credit and lease transactions in 2018. The Dodd-Frank Act amended the Truth in Lending Act (TILA) and the Consumer Leasing Act (CLA) to require an annual adjustment to these thresholds based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers. For 2018, consumer credit and lease transactions of $55,800 or less will be subject to TILA and CLA. However, private education loans and loans secured by real property are subject to TILA regardless of amount.
The OCC recently released three revised booklets for the Comptroller’s Licensing Manual. The OCC revised the Subordinated Debt, Background Investigations and Business Combinations booklets. The revised Subordinated Debt booklet was updated to reflect the following:
- New requirements for issuing subordinated debt and including it as tier 2 capital for a national bank or FSA; and
- New policies and procedures that a bank should follow to issue subordinated debt and the approval process for including it as tier 2 capital.
The newly revised Subordinated Debt booklet also includes informational resources and sample notes that banks may find useful during the subordinated debt process. The OCC revised the Background Investigations booklet to include the following updates:
- New requirements to notify the OCC when a national bank or federal savings association, or a federal branch or agency of a foreign bank, changes its directors or senior executive officers; and
- Outlines of the documents required by the OCC to review the background of proposed bank directors and executive officers.
The revised Business Combinations booklet:
- Provides an overview of policies and decision criteria that the OCC considers when reviewing applications from banks seeking to execute a merger, consolidation, certain purchase and assumption transactions, and reorganizations under 12 USC 215a-2;
- Describes the application process, including the prefiling process, filing and review of the application, the decision, and the post-consummation phase of the combination;
- Provides guidance on application requirements and explains under which circumstances a streamlined business combination is granted; and
- Lists references and links to informational resources and sample forms and documents that applicants may find useful during the filing process.
On October 26, the staff (the Staff) of the U.S. Securities and Exchange Commission (SEC) issued three related no-action letters providing market participants with greater clarity as to how certain aspects of their business activities can comply with potentially competing systems of regulations. Specifically, the relief seeks to address potential conflicts between the requirements of the U.S. federal securities laws and the requirements of the European Union’s (EU) Markets in Financial Instruments Directive II (MiFID II), which have an implementation date of January 3, 2018. For more information, read the client alert issued by Goodwin’s Investment Management practice.
During a speech on November 8 at the 49th Annual Institute on Securities Regulation, SEC Chairman Jay Clayton discussed initial coin offerings, stating that he had “yet to see an ICO that doesn’t have a sufficient number of hallmarks of a security,” seeming to indicate increased SEC scrutiny on many ICOs as similar to more traditional stock offerings. View the Digital Currency + Blockchain Perspectives blog post.
Join Goodwin on November 30 for the 6th Annual Banking Symposium, a forum for CEOs and senior management to discuss emerging issues in the financial industry. This year’s symposium, Innovation: The Great Equalizer, will feature entrepreneurs and disrupters, and highlight opportunities for innovation across the industry. Our keynote speaker, Brian Forde, is a Senior Lecturer for Bitcoin and Blockchain, MIT Sloan School of Management, and previously served as Senior Advisor for Mobile and Data Innovation for the White House. For more information, please visit the event website.
Hosted by the MIT Club of Northern California, the event will address important topics in the digital currency industry including: What is a cryptocurrency and why does it have value? What is an ICO and how have tech entrepreneurs raised billions of dollars in non-dilutive financing? Can existing startups add cryptocurrency to their business model? In this installment of our “View From The Top” series, you’ll hear answers to these questions and more from some of the key leaders in this fast-growing field. Grant Fondo, Chair of Goodwin’s Digital Currency + Blockchain Technology practice, will be a featured speaker.
This week’s Roundup contributors: William McCurdy.