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The Securities and Exchange Commission has announced charges against Ramil Palafox for orchestrating a fraudulent scheme that raised approximately $198 million from investors worldwide and for misappropriating more than $57 million of investor funds.

According to the SEC’s complaint, Palafox’s company, known as PGI Global, claimed to be a crypto asset and foreign exchange trading company. From January 2020 through October 2021, Palafox offered and sold PGI Global “membership” packages, which he claimed guaranteed investors high returns from PGI Global’s supposed crypto asset and foreign exchange trading and offered members multi-level-marketing-like referral incentives to encourage them to recruit new investors. However, as the complaint alleges, Palafox misappropriated more than $57 million in investor funds to buy Lamborghinis, items from luxury retailers, and for other personal expenses. He also used the majority of the remaining investor funds to pay other investors their purported returns and referral rewards in a Ponzi-like scheme until its collapse in late 2021.

The complaint, filed in the U.S. District Court for the Eastern District of Virginia, charges Palafox with violating the anti-fraud and registration provisions of the federal securities laws. The complaint seeks permanent injunctive relief, conduct-based injunctions preventing Palafox from participating in multi-level-marketing programs involving the offer or sale of securities and offerings of crypto assets bought or sold as a security, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties. The complaint also names BBMR Threshold LLC, Darvie Mendoza, Marissa Mendoza Palafox, and Linda Ventura as relief defendants and seeks disgorgement of their ill-gotten gains and prejudgment interest.

The Federal Reserve Board has announced the withdrawal of guidance for banks related to their crypto-asset and dollar token activities and related changes to its expectations for these activities. These actions ensure the Board's expectations remain aligned with evolving risks and further support innovation in the banking system.

The Board is rescinding—

• SR 22-6/CA 22-6: Engagement in Crypto-Asset-Related Activities by Federal Reserve-Supervised Banking Organizations
• SR 23-8 / CA 23-5: Supervisory Nonobjection Process for State Member Banks Seeking to Engage in Certain Activities Involving Dollar Tokens (withdrawn)

The Board and the FDIC are joining the Office of the Comptroller of the Currency in withdrawing from two 2023 statements jointly issued by the federal bank regulatory agencies regarding banks' crypto-asset activities and exposures. The Board will work with the agencies to consider whether additional guidance to support innovation, including crypto-asset activities, is appropriate.

• Joint Statement on Crypto-Asset Risks to Banking Organizations (withdrawn)
• Joint Statement on Liquidity Risks to Banking Organizations Resulting from Crypto-Asset Market Vulnerabilities (withdrawn)
• Related FDIC Press Release

FDIC Financial Institution Letter FIN-11-2025, issued yesterday, announces that the FDIC is changing the virtual data room (VDR) contractor used to market failing financial institutions. Beginning in May 2025, the FDIC will begin using the ShareVault VDR, instead of the current vendor, DFIN Solutions Venue. for all new projects. The change is the result of a competitive bidding process.

The FDIC has used VDRs to market failing institutions since 2000. A VDR is a secure web site that the FDIC populates with information about failing insured institutions. The FDIC gives qualifying financial institutions access to the VDR, which helps them determine their interest in purchasing a failing financial institution and evaluate the offering. Users must first sign a confidentiality agreement before they gain entry to the VDR.

The Federal Trade Commission has approved a final consent order against accessiBe Inc. and accessiBe Ltd., for falsely claiming their plug-in accessWidget can make any website compliant with Web Content Accessibility Guidelines (WCAG). The order prohibits accessiBe from making misleading claims and requires the company to pay $1 million.

The FTC’s January 2025 proposed complaint alleged that despite the company’s claims, accessWidget did not make all user websites WCAG-compliant and these claims were false, misleading, or unsubstantiated. In addition, the complaint alleged that accessiBe deceptively formatted third-party articles and reviews to appear as if they were independent opinions and failed to disclose the company’s material connections to the supposedly objective reviewers.

The final order bars accessiBe from representing that its automated products can make any website WCAG-compliant or can ensure continued compliance with WCAG over time, unless it has the evidence to support such claims.

FOX San Antonio reports that a federal judge in San Antonio has temporarily halted a new mandate requiring money service businesses along the Texas-Mexico and California-Mexico borders to report cash transactions as low as $200. Judge Fred Biery's restraining order affects counties in Texas and California.

BankingDive reported yesterday that Coinbase is considering applying for a federal bank charter, according to a company spokesperson, as cryptocurrency firms seek to capitalize on recent regulatory easing. The BankingDive article said that Coinbase is one of four crypto companies identified by the Wall Street Journal Monday as currently planning to seek a bank charter, alongside crypto custodian BitGo and stablecoin issuers Circle and Paxos.

Last month, the OCC rescinded a Biden-era requirement that banks obtain supervisory non-objection before engaging in crypto-related activities. One benefit crypto firms would see after obtaining a bank charter is direct access to the payments system.

Yesterday, the Social Security Administration announced it is reinstating National Social Security Month—a public awareness campaign held in April each year that is dedicated to helping Americans access their benefits. The agency last observed National Social Security Month in 2019, during President Trump’s first term. The early days of the COVID-19 pandemic forced the cancellation of National Social Security Month in 2020, and it has not been observed since.

Effective immediately, April of each year will once again be recognized as National Social Security Month. This year, the period of enhanced public outreach will extend to August 14, when Social Security celebrates its 90th Anniversary.

The Small Business Administration has announced it will eliminate a package of reduced underwriting standards — the so-called "Do What You Do" standards adopted during the Biden Administration — by issuing a new SOP 50.10.8, which rejects the "Do What You Do" standards and returns previous, more robust, lending criteria.

The National Credit Union Administration Board has published [90 FR 16999] in today's Federal Register a notification of its request for comments on two of its recently published final rules that have not fully taken effect. The Board invites comment on its final rule captioned “Simplification of Share Insurance,” published on September 30, 2024, which takes full effect on December 1, 2026; and the final rule captioned “Succession Planning,” published on December 26, 2024, which takes full effect on January 1, 2026. The public comment period will allow interested parties to provide comments about issues of fact, law, and policy raised by the two final rules, in accordance with the January 20, 2025, White House memorandum to the Heads of Executive Departments and Agencies, captioned “Regulatory Freeze Pending Review.”

Comments on both rules will be accepted through June 23, 2025.

The ABA Banking Journal has reported that 88 House Democrats have asked Treasury Secretary Scott Bessent to exempt the Community Development Financial Institutions (CDFI) Fund from a recent executive order that it scale back its operations to the minimum level needed to carry out its statutory obligations.

The Treasury Department has reported that OFAC has designated Iranian national and liquified petroleum gas (LPG) magnate Seyed Asadoollah Emamjomeh, his son, Meisam Emamjomeh, and their corporate network, which is collectively responsible for shipping hundreds of millions of dollars’ worth of Iranian LPG and crude oil to foreign markets.

For a link to identification information on the designated individuals, entities, and a vessel, see yesterday’s BankersOnline OFAC Update.

The Federal Reserve Board has published in this morning's Federal Register [90 FR 16843] its previously announced proposal to modify its Capital Plan Rule and Stress Capital Buffer Requirements, which would amend Federal Reserve Regulations Y, LL, and YY (parts 225, 238, and 252).

Comments on the proposal will be accepted for 62 days, through June 23, 2025.

The Federal Trade Commission has published a final rule [90 FR 16918] in this morning's Federal Register amending the Children's Online Privacy Protection Rule (the “Rule”), consistent with the requirements of the Children's Online Privacy Protection Act. The amendments to the Rule, which are based on the FTC's review of public comments and its enforcement experience, include one new definition and modifications to several others, as well as updates to key provisions to respond to changes in technology and online practices. The amendments are intended to strengthen protection of personal information collected from children, and, where appropriate, to clarify and streamline the Rule since it was last amended in January 2013.

The amended rule will be effective on June 23, 2025. Regulated entities have until April\ 22, 2026, to comply, except for selected provisions, which have earlier compliance dates.

Last week, we noted plans for a mass firing of around 1,500 CFPB employees in a sudden shrinking of the agency's activity. Today, we see that ABC News reported on Friday afternoon, that a federal judge in Washington, D.C., has ordered an immediate halt to the planned firings of nearly 1,500 employees at the Consumer Financial Protection Bureau, and is ordering the Trump administration to hand over communications and make top officials available for testimony to determine whether they deliberately violated one of her court orders.

District Judge Amy Berman Jackson told attorneys for the government she was "deeply concerned" about the apparently rushed efforts to implement a Reduction In Force, or RIF, of approximately 1483 employees at the CFPB which was set to take effect at 6 pm Friday evening.

Jackson said the moves by CFPB leadership, in apparent coordination with a staffer from Elon Musk's DOGE operation, may be in direct violation of a preliminary injunction she had put in place -- which the D.C. Circuit upheld in part. That injunction required terminations at the agency to be carried out only after "particularized assessments" of individual employees' performance.

The FDIC reports it has taken action to modify its approach to insured depository institution (IDI) resolution planning. The purpose of this action is to focus the IDI resolution planning process on the operational information most relevant for the FDIC to (1) resolve a large bank through a weekend sale or (2) operate the institution for a short period of time while rapidly marketing the institution

For full resolution submissions during the upcoming submission cycle, the FDIC has exempted IDIs from certain content requirements, such as the requirements to utilize a bridge bank strategy and a hypothetical failure scenario in the plan.

“The 2023 bank failures served as a reminder of how costly and damaging a bridge bank solution can be,” said Acting Chairman Travis Hill. “Today’s action is one step in shifting our approach towards maximizing the likelihood of a lower cost and more stabilizing resolution for large regional banks.”

In addition, the FDIC has issued an updated set of frequently asked questions (FAQs) describing the exemptions and clarifying certain expectations. The FDIC is continuing to evaluate other provisions in the IDI Rule, and their applicability to different cohorts of banks, and may issue additional FAQs at a later date.

The Federal Reserve Board has announced its approval of the application by Capital One Financial Corporation, of McLean, Virginia, to merge with Discover Financial Services, of Riverwoods, Illinois, and thereby indirectly acquire Discover Bank, of Greenwood, Delaware.

The Board also entered into a consent order with Discover and assessed a fine of $100 million for overcharging certain interchange fees from 2007 through 2023. Discover has since terminated these practices and is repaying those fees to affected customers. The Board's action is being taken in coordination with the Federal Deposit Insurance Corporation. As a condition of the Board's approval of the merger application, Capital One has committed that it will comply with the Board's action against Discover, including remediation requirements.

The FDIC has assessed a civil money penalty of $150 million against Discover Bank in connection with those overcharges of interchange fees, and has ordered restitution to the bank's customers of at least $1.225 billion.

The OCC announced its approval of the merger, which is conditioned upon the approved plans detailing effective and sustainable corrective actions and timelines to address the root causes of any outstanding enforcement actions against Discover Bank and remediation of harm.

For additional information and access to the Federal Reserve's and FDIC's orders against Discover, see Discover fined by Fed and FDIC for interchange fee practices, in the BankersOnline Penalties pages.

FinCEN has issued updated Frequently Asked Questions about its Geographic Targeting Order (GTO) of March 11, 2025, requiring money services businesses in 30 ZIP Codes across California and Texas near the U.S.-Mexico border to file CTRs with FinCEN for transactions above $200 but not more than $10,000. This GTO became effective April 14, 2025, and will end September 9, 2025, unless extended.

Updates to the FAQs are tagged as issued or updated on April 16, 2025.

The Federal Reserve Board on Thursday requested comment on a proposal to reduce the volatility of the capital requirements stemming from the Board's annual stress test results. The Board's stress test evaluates the resilience of large banks by estimating their losses, revenue, and capital levels under a hypothetical severe recession scenario. Due to the changing hypothetical nature of the test, the results also change and introduce volatility each year. The results, in part, determine the calibration of the stress capital buffer (SCB), which is one component of the amount of capital large banks must hold to absorb losses.

The proposal would average stress test results over two consecutive years to reduce the year-over-year changes in the capital requirements that result from the stress test. In addition, the proposal would delay the annual effective date of the stress capital buffer requirement from October 1 to January 1 of the following year, giving banks additional time to adjust to their new capital requirements. Lastly, the proposal would make targeted changes to streamline the Board's stress test-related data collection. These proposed changes are not designed to materially affect overall capital requirements.

Later this year, the Board intends to propose additional changes to improve the transparency of the stress test. Comments on today's proposal are due 60 days after publication in the Federal Register.

• Press release
• Board memo
• Statement against proposal by Governor Michael S. Barr
• Statement supporting proposal by Governor Adriana D. Kugler
• PUBLICATION AND COMMENT PERIOD UPDATE: Published [90 FR 16843] on 4/22/2025. Comments accepted for 62 days, through 6/23/2025)

The Treasury Department has reported that OFAC has sanctioned Yemen-based International Bank of Yemen Y.S.C. (IBY) for its financial support to Ansarallah, commonly known as the Houthis, which is part of the Iran threat network. As part of this designation, OFAC is also sanctioning key leaders or officials of IBY, Kamal Hussain Al Jebry, Ahmed Thabit Noman Al-AbsiM, and Abdulkader Ali Bazara. The designation of IBY complements the whole-of-government effort to stop Iran-backed Houthi attacks against commercial shipping in the Red Sea.

For a link to identification information on the designated parties, see yesterday’s BankersOnline OFAC Update, where you will also find a link to Counter Terrorism General License 33, "Authorizing the Wind Down of Transactions Involving International Bank of Yemen (IBY).".

The OCC has released enforcement actions taken against individuals currently and formerly affiliated with institutions the OCC supervises. Three orders of prohibition, which prohibit an individual from any participation in the affairs of a bank or other institution as defined in 12 USC 1818(e)(7), were included.

• Order of Prohibition against Alhassan Abubakar, former associate banker at a New York, New York, branch of JPMorgan Chase Bank, National Association, Columbus, Ohio, for misappropriating $20,000 from the bank.
• Order of Prohibition against Jacqueline Molina, former customer service representative at TD Bank, N.A., Wilmington, Delaware, for fraudulently obtaining over $40,000 in Paycheck Protection Program funds under the Coronavirus Aid, Relief, and Economic Security Act.
• Order of Prohibition against Nick Zatikian, former associate banker at a Tujunga, California, branch of JPMorgan Chase Bank, National Association, Columbus, Ohio, for embezzling at least $34,900 from the bank and altering the bank's internal records to conceal his embezzlement.

FOX Business News yesterday reported that the Trump administration is sending layoff notices to more than 1,500 staff members at the CFPB, leaving only 200 personnel at the Bureau.

Sources have reported that a letter was sent to CFPB staff from the agency's chief legal officer that outlined how the agency is refocusing its efforts on "tangible harm to consumers" by reallocating resources from enforcement and supervision activities that can be done by states. The CFPB's supervision arm will reduce the number of supervisory "events" or exams by 50%, with a focus on "conciliation, correction and remediation of harms subject to consumers' complaints."

The Bureau will also move its focus to primarily being on depository institutions, rather than non-depository institutions, returning to a 2012 mix when 70% of CFPB supervision was on banks and depository institutions and 30% on nonbanks.

The Treasury Department yesterday announced that OFAC has designated China-based independent “teapot” refinery Shandong Shengxing Chemical Co., Ltd. for its role in purchasing more than a billion dollars’ worth of Iranian crude oil, including from a front company for Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). OFAC is also imposing additional sanctions on several companies and vessels responsible for facilitating Iranian oil shipments to China as part of Iran’s “shadow fleet.”

For a link to identification information on the designated parties (and vessels), and to updated "Guidance for Shipping and Maritime Stakeholders on Detecting and Mitigating Iranian Oil Sanctions Evasion," see yesterday’s BankersOnline OFAC Update.

The OCC yesterday announced changes to its organizational structure to ensure its approach to supervision evolves to better address today’s challenges, align similar functions within the agency, and leverage opportunities for efficiencies.

• The OCC will combine the Midsize and Community Bank Supervision and Large Bank Supervision functions to create the Bank Supervision and Examination line of business. This will allow for seamless sharing of expertise and resources to address bank-specific issues or novel needs and provides opportunities for career development and progression for the agency’s entire examination workforce.
• The agency will reinstate the Chief National Bank Examiner office which will include the divisions of Bank Supervision Policy as well as Supervision Risk and Analysis. Organizing risk identification, analysis and policy efforts will ensure a seamless approach to knowledge sharing and supervision.
• The OCC also announced that it is elevating its Information Technology and Security (ITS) function to be led by a new Senior Deputy Comptroller for ITS, who will serve as a member of the Executive Committee.

The changes will be effective starting June 2, 2025.

The ABA Banking Journal reports that President Trump has removed Democrats Todd Harper and Tanya Otsuka from the National Credit Union Administration board. Their departures leave only Trump-appointed Chairman Kyle Hauptman on the three-person board.

The Treasury Department has reported that OFAC yesterday sanctioned four individuals affiliated with La Nueva Familia Michoacana (LNFM), a Mexican cartel designated as a Foreign Terrorist Organization and a Specially Designated Global Terrorist, that has poisoned Americans by trafficking fentanyl and other illicit drugs into the United States. LNFM’s crimes also include the smuggling of illegal aliens into the United States and violence against its rivals and Mexican security forces, utilizing drones and bombs in addition to conventional firearms. Those sanctioned today, all of whom are siblings, include the group’s notorious co-leaders: Johnny Hurtado Olascoaga and Jose Alfredo Hurtado Olascoaga.

For a link to identification information on the designated parties, see yesterday’s BankersOnline OFAC Update.

The Federal Reserve Board has released the minutes of the Board's discount rate meetings on February 18, March 10, and March 19, 2025.

FDIC FIL-9-2025 was issued yesterday to announce the FDIC is making permanent the establishment of electronic communications as the preferred method for supervisory correspondence. This makes permanent the alternative secure mail procedures that were initially implemented on a temporary basis in March 2020.

Attached Supervisor Correspondence Procedures provide guidance on how to send official correspondence related to supervisory matters to the FDIC using the FDIC's Secure Email portal. The FDIC will use the portal to send outgoing mail for official supervisory correspondence. If electronic communications are not available financial institutions can continue to submit correspondence in hardcopy format, but use of hardcopy documents is expected to be rare.

Our monthly review of the Federal Reserve Board's archive of Community Reinvestment Act evaluations has determined that the Reserve Banks publicly released 19 evaluations in March 2025. Sixteen of those evaluations received a Satisfactory rating.

We offer our congratulations to these three banks, whose evaluations received Outstanding ratings:

• East West Bank, Pasadena, California
• The Genoa Banking Company, Genoa, Ohio
• Green Dot Bank, Provo, Utah

Links are to the banks' evaluations.

PYMNTS has reported that Bank of America has been ordered to pay $540.3 million following a judge's ruling in a lawsuit in which the FDIC accused the bank of paying less than it owed for deposit insurance. In a decision made public on Monday, U.S. District Judge Loren AliKhan in Washington, D.C., said the payment covers assessments from the second quarter of 2013 through the end of 2014, plus interest.

The FDIC sued Charlotte, North Carolina-based Bank of America for $1.12 billion in 2017, accusing it of reducing its deposit insurance contributions by failing to honor a 2011 rule that changed how banks report risk exposure to counterparties. That rule was one of many federal reforms designed to ensure the stability of the banking system, and avert a repeat of the 2008 global financial crisis. But the judge ruled that the FDIC had waited too long to sue over claims predating the second quarter of 2013.

The OCC has publicly released a letter sent to its supervised institutions regarding unauthorized access to OCC email systems. The OCC provided public notice of the unauthorized access and its designation as a major information security incident on April 8, 2025.

The OCC said it will inform each regulated institution if it determines the unauthorized user accessed information specific to that institution for their awareness. The OCC also will provide all supervised institutions with email user domains that were included in the compromised information so they may determine what information or data they may have sent to OCC users during the timeframe of the unauthorized access.

The FDIC, Federal Reserve Board, NCUA, and OCC have jointly announced they have temporarily paused certain appraisal requirements for real estate-related transactions, to help facilitate recovery efforts from wildfires and straight-line wind damage in Los Angeles County, California, this year, .

The agencies' action is expected to allow banks and credit unions to work with families and businesses without obtaining an appraisal. Banks and credit unions will still be required to determine that the value of the real estate supports the institution's decision to enter into the transaction.

The pause should make financial institutions better able to lend or modify loans in areas where wildfire and straight-line wind damage has made appraisals challenging to obtain. This action is also expected to reduce loan processing times, helping to facilitate recovery from the disaster.

The temporary pause order will be effective upon its publication in the Federal Register. It will expire on January 8, 2028, three years after the president declared the relevant area a major disaster. The agencies will monitor institutions' real estate lending practices to ensure that transactions are being conducted in a safe and sound manner.

• OCC Bulletin 2025-7, "Real Estate Appraisals: Temporary Exceptions to Appraisal Requirements in Areas Affected by Los Angeles County, California, Wildfires and Straight-Line Winds"
• FDIC FIL-10-2025, "FDIC Issues Temporary Exceptions to Appraisal Requirements in Los Angeles County as Affected by California Wildfires and Straight-line Winds"
• UPDATE ON PUBLICATION AND EFFECTIVE DATE: Published [90 FR 16455] on 4/18/2025, and effective on publication as noted above.

Yesterday, Federal Reserve Board Governor Christopher J. Waller spoke at the Certified Financial Analysts Society of St. Louis, St. Louis, Missouri, on "A Tale of Two Outlooks," discussing his outlook for the U.S. economy and the implications for monetary policy following recent announcements on tariffs to be imposed by the current Administration. He described tariffs as "the elephant in the room," to be talked about.

The Financial Stability Board has announced it has published its finalized Format for Incident Reporting Exchange (FIRE), a global initiative aimed at streamlining cyber and operational incident reporting. By introducing a standardized format, FIRE addresses the fragmentation in reporting requirements, alleviating the burden on firms that operate across multiple jurisdictions.

FIRE encompasses a wide range of operational and cyber incidents. Its potential applicability extends to third-party service providers and firms beyond the financial sector. Its focus on promoting convergence and flexibility in incident reporting has garnered strong support, underscoring its practical value and relevance to stakeholders.

• Final report

The ABA Banking Journal has reported that the CFPB has reached an agreement with the American Bankers Association and others to settle a lawsuit over its 2024 rule on credit card late fees.

Last year, the CFPB issued a final rule to lower the safe harbor dollar amount for late fees to $8, eliminate a higher safe harbor dollar amount for late fees for subsequent violations of the same type, and eliminate the annual inflation adjustment for the safe harbor amount that was provided by the Federal Reserve in 2010. A suit was brought by the ABA, the U.S. Chamber of Commerce, and others asserting that the CFPB exceeded its statutory authority in issuing the rule. Under the terms of a settlement, the Bureau acknowledged the allegations, and the parties have asked the court to vacate the rule.

On April 15, the ABA Banking Journal reported that the court has vacated the rule.

FinCEN has announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in non-financed purchases of residential real estate. FinCEN said the terms of the GTOs are effective beginning April 15, 2025, and ending on October 9, 2025, and that the GTOs continue to provide valuable data on the purchase of residential real estate by persons possibly involved in various illicit enterprises. Renewing the GTOs will further assist in tracking illicit funds and other criminal or illicit activity.

FinCEN renewed the GTOs that cover certain counties and major U.S. metropolitan areas in California, Colorado, Connecticut, Florida, Hawaii, Illinois, Maryland, Massachusetts, Nevada, New York, Texas, Washington, Virginia, and the District of Columbia. No changes have been made to jurisdictional coverage since the last issuance of these GTOs. The purchase price threshold likewise remains $300,000 for each covered metropolitan area, with the exception of the City and County of Baltimore, where the purchase price threshold is $50,000.

• FAQs on the GTOs

The CFPB, on April 7, 2025, filed with the U.S. District Court for the Southern District of New York a Consent Motion to withdraw as a plaintiff in a case filed jointly in 2022 with the Attorney General of the State of New York against MoneyGram International, Inc. and MoneyGram Payment Systems, Inc. In that case, the CFPB and the State of New York alleged that MoneyGram violated Regulation E and the Remittance Transfer Rule, which implement the Electronic Fund Transfer Act, and the Consumer Financial Protection Act.

The Bureau's withdrawal leaves the People of the State of New York as the sole plaintiffs in the suit.

The New York State Department of Financial Services (DFS) has announced that Block, Inc. will pay a $40 million penalty for significant failures in its Bank Secrecy Act/Anti-Money Laundering compliance program, which violated DFS money transmitter and virtual currency regulations. In addition to the monetary penalty, Block is required to retain an independent monitor to perform a comprehensive evaluation of its compliance with the Department’s regulations and its remediation efforts.

DFS Superintendent Adrienne A. Harris said, "The rapid growth of Block’s Cash App absent a robust compliance function created risk and vulnerabilities that violated the rules financial services companies operating in New York must adhere to. The Department is taking decisive steps to ensure accountability, including the appointment of an independent monitor to oversee corrective measures.”

Block owns and operates Cash App, a peer-to-peer money transmission service that allows users to send and receive fiat currency. The company has been licensed by the Department to conduct money transmission business in the State of New York since 2013, and virtual currency business through Cash App since 2018.

For more information and a link to the DFS Consent Order, see "Block, Inc. to pay $40M for failures in BSA/AML program," in the BankersOnline Penalty pages.

Republican lawmakers in the House and Senate have introduced a joint resolution of disapproval under the Congressional Review Act to overturn a 2024 final rule that changed how the Office of the Comptroller of the Currency reviews proposed bank mergers, according to a press release from Congressman Andy Barr's office. .

The OCC last year adopted a rule that ended its practice of automatically approving merger applications on the 15th day after the close of the comment period unless the agency takes action to remove the filing for expedited processing. The rule also amended how the OCC considers financial stability, financial and managerial resources, future prospects, and convenience and needs factors.

If passed in both the House and the Senate and approved by the president, the resolution, introduced by Representative Barr (R-KY) and Senator John Kennedy (R-LA), would also prohibit the OCC from issuing merger regulations in the future without congressional authorization.

The CFPB on Friday announced that, with respect to the regulation titled "Registry of Nonbank Covered Persons Subject to Certain Agency and Court Orders," subpart B of 12 CFR part 1092, it will not prioritize enforcement or supervision actions with regard to entities that do not satisfy future deadlines under the regulation to submit registration information. This policy applies to, but is not limited to, the upcoming April 14, 2025 registration deadline for entities subject to 12 CFR 1092.206(a)(2) and July 14, 2025 registration deadline for entities subject to 12 CFR 1092.206(a)(3). The Bureau will instead continue to focus its enforcement and supervision activities on pressing threats to consumers.

The Bureau is further considering issuing a notice of proposed rulemaking to rescind the regulation or narrow its scope.

The Small Business Administration has announced several new verification measures within its loan application process to strengthen protections against fraud and ensure its programs only benefit eligible American small business owners. Key changes include:

• Citizenship Verification: All SBA loan applications now include a citizenship verification provision to ensure only legal, eligible applicants can access SBA programs. Lenders are required to confirm that applicant businesses are not owned in whole or in part by an illegal alien.
• Date of Birth Verification: All SBA loan applications now include a process to verify applicant age and date of birth. This provision will mitigate fraud stemming from applicants using an identity other than their own, including those of children or the deceased.
• Automatic Fraud Alerts: SBA’s date of birth verification process will automatically flag any applicant claiming to be younger than 18 or older than 115 years of age.

The Treasury Department has reported that OFAC has designated United Arab Emirates (UAE)-based Indian national Jugwinder Singh Brar (Brar), who owns multiple shipping companies that boast a fleet of nearly 30 vessels, many of which operate as part of Iran’s “shadow fleet.” OFAC is also designating two UAE- and two India-based entities that own and operate Brar’s vessels that have transported Iranian oil on behalf of the National Iranian Oil Company (NIOC) and the Iranian military.

According to Treasury, Brar’s vessels engage in high-risk ship-to-ship (STS) transfers of Iranian petroleum in waters off Iraq, Iran, the UAE, and the Gulf of Oman. These cargoes then reach other facilitators who blend the oil or fuel with products from other countries and falsify shipping documents to conceal links to Iran, allowing these cargoes to reach the international market.

Concurrently, the Department of State designated four companies for having knowingly engaged in a significant transaction for the purchase, acquisition, sale, transport, or marketing of petroleum or petroleum products from Iran, and identifying two vessels as blocked property of two of these companies.

For a link to identification information on the designated individuals, entities, and vessels, see yesterday’s BankersOnline OFAC Update.

The Treasury Department has announced that OFAC has sanctioned Mexican national Jesus Alfredo Beltran Guzman, a key leader of the Beltran Leyva Organization (BLO), for playing a significant role in the trafficking of illicit drugs, including fentanyl, cocaine, heroin, and methamphetamine, into the United States.

Treasury also reported that OFAC has designated five entities and one individual based in Iran for their support to key entities that manage and oversee Iran’s nuclear program, including the Atomic Energy Organization of Iran and its subordinate Iran Centrifuge Technology Company.

For a link to identification information on the designated parties, see yesterday’s BankersOnline OFAC Update.

The Federal Reserve Board has released the minutes of the Federal Open Market Committee meeting on March 18–19, 2025.

Yesterday, the House of Representatives passed a joint resolution to overturn the Consumer Financial Protection Bureau’s "Overdraft Lending: Very Large Financial Institutions" rule. The CFPB overdraft limit requires banks with at least $10 billion in assets to cap overdraft fees at $5 unless they voluntarily set a cap that covers their actual costs and losses or treat overdraft protection as a loan covered by the Truth in Lending Act.

The House also passed a joint resolution disapproving the rule submitted by the CFPB relating to "Defining Larger Participants of a Market for General-Use Digital Consumer Payment Applications."

The two joint resolutions now go to the president, who can approve or veto them. If he approves the resolutions, the CFPB rules will be nullified, and no substantially similar rules can be issued.

The Department of Housing and Urban Development has announced the Federal Housing Administration (FHA) is extending by an additional 90 days its existing foreclosure moratoriums on FHA-insured single family mortgages in the Presidentially-Declared Major Disaster Areas (PDMDAs) resulting from Hurricanes Helene and Milton. The extensions provide more time for impacted American families in devastated areas in Florida, Georgia, North Carolina, South Carolina, Tennessee, and Virginia to seek Federal, state, or local assistance and underscore HUD’s commitment to supporting Americans impacted by the hurricanes.

The FHA insures over one million single family mortgages in the Helene and Milton PDMDAs. The moratoriums prohibit mortgage servicers from initiating or completing foreclosure actions on FHA-insured single family forward or Home Equity Conversion mortgages in the Hurricane Helene and Milton PDMDAs through July 10, 2025. This is the second extension of the moratoriums, which were most recently set to expire on April 11, 2025.

Today, FinCEN issued a Financial Trend Analysis focused on patterns and trends identified in Bank Secrecy Act (BSA) data linked to fentanyl-related illicit finance. Between January and December 2024, financial institutions filed 1,246 BSA reports that identified suspected fentanyl-related activity amounting to approximately $1.4 billion in suspicious transactions. The reported financial activity highlighted various aspects of the illicit fentanyl supply chain—including precursor chemical procurement, fentanyl trafficking, and fentanyl-linked money laundering—that have touchpoints across the U.S. financial sector.

Illicit fentanyl is primarily synthesized, trafficked, and smuggled into the United States by Mexican cartels. The Sinaloa Cartel and the Cartel Jalisco Nueva Generacion—which are Foreign Terrorist Organizations, Specially Designated Global Terrorists, and Drug Trafficking Organizations—largely control the fentanyl supply chain from Mexico and use precursor chemicals and manufacturing equipment primarily sourced from the People’s Republic of China (PRC) to synthesize illicit fentanyl in clandestine laboratories. FinCEN analysis identified Mexico and the PRC as the top two foreign countries listed in subject address fields of fentanyl-related BSA reports filed in 2024.

FinCEN continues to encourage financial institutions to carefully review its August 2019 and June 2024 advisories on the trafficking of fentanyl, fentanyl analogues, and other synthetic opioids and the precursor chemicals and associated manufacturing equipment needed to synthesize these deadly drugs.

The OCC has issued Bulletin 2025-6 to inform OCC-supervised institutions of the appropriate names and addresses for notices required by the Community Reinvestment Act (CRA) and Equal Credit Opportunity Act, and for posters required by the Fair Housing Act. Banks should make the appropriate changes to their notices and posters, if necessary, within 90 days of this bulletin’s date of issuance [by July 7, 2025]. Yesterday's Bulletin rescinds Bulletin 2021-35.

Community Reinvestment Act - Public Notice by Banks

The CRA public notices must include the physical address of the appropriate Office of the Comptroller of the Currency (OCC) supervisory office and an email address for purposes of informing the public how to (1) obtain a list of banks that are scheduled for CRA examination each quarter, (2) obtain an announcement of bank applications covered by the CRA filed with the OCC, or (3) send written comments about the needs and opportunities in any of the bank’s assessment areas.

The email address for all banks is CRAComments@occ.treas.gov.

Large Bank Supervision
Deputy Comptroller
Large Bank Supervision
Office of the Comptroller of the Currency
400 7th St. SW
Washington, DC 20219

Midsize and Trust Supervision
Deputy Comptroller
Midsize Bank Supervision
Office of the Comptroller of the Currency
400 7th St. SW
Washington, DC 20219

East Region
Deputy Comptroller
East Region
Office of the Comptroller of the Currency
7 Times Square, 10th Floor
New York, NY 10036

Midwest Region
Deputy Comptroller
Midwest Region
Office of the Comptroller of the Currency
1050 17th St., Suite 1500
Denver, CO 80265

Northeast Region
Deputy Comptroller
Northeast Region
Office of the Comptroller of the Currency
7 Times Square, 10th Floor
New York, NY 10036

South Region
Deputy Comptroller
South Region
Office of the Comptroller of the Currency
1700 Pacific Ave., Suite 3600
Dallas, TX 75201

Southeast Region
Deputy Comptroller
Southeast Region
Office of the Comptroller of the Currency
1700 Pacific Ave., Suite 3600
Dallas, TX 75201

West Region
Deputy Comptroller
West Region
Office of the Comptroller of the Currency
1050 17th St., Suite 1500
Denver, CO 80265

Fair Housing Act - Posters

Banks must post and maintain fair housing posters at all of their places of business that participate in the activities subject to the Fair Housing Act. Federal savings associations are required to include in their posters a statement directing persons who believe that they have been discriminated against to send a complaint to the Assistant Secretary for Fair Housing and Equal Opportunity, U.S. Department of Housing and Urban Development, Washington, DC 20410, and to the appropriate federal regulator.

Banks should use the following address in their Fair Housing Act posters:

Office of the Comptroller of the Currency
Customer Assistance Group
P.O. Box 53570
Houston, TX 77052

Banks with $10 billion or less in assets must provide a notice that is substantially similar to the following statement:

The federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Protection Act. The federal agency that administers compliance with this law concerning this creditor is:

Office of the Comptroller of the Currency
Customer Assistance Group
P.O. Box 53570
Houston, TX 77052

Banks with more than $10 billion in assets must provide a notice that is substantially similar to the following statement:

The federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Protection Act. The federal agency that administers compliance with this law concerning this creditor is:

Consumer Financial Protection Bureau
1700 G St. NW
Washington, DC 20006

The OCC has announced it has notified Congress of a major information security incident, as required by the Federal Information Security Modernization Act. The incident was reported to the public on February 26, 2025.

On February 11, 2025, the OCC learned of unusual interactions between a system administrative account in its office automation environment and OCC user mailboxes. On February 12, the OCC confirmed the activity was unauthorized and immediately activated its incident response protocols, which include initiating an independent third-party incident assessment and reporting the incident to the Cybersecurity and Infrastructure Security Agency. On February 12, the OCC disabled the compromised administrative accounts and confirmed that the unauthorized access had been terminated.

The OCC discovered that the unauthorized access to a number of its executives’ and employees’ emails included highly sensitive information relating to the financial condition of federally regulated financial institutions used in its examinations and supervisory oversight processes.

“The confidentiality and integrity of the OCC’s information security systems are paramount to fulfilling its mission,” said Acting Comptroller of the Currency Rodney E. Hood. “I have taken immediate steps to determine the full extent of the breach and to remedy the long-held organizational and structural deficiencies that contributed to this incident. There will be full accountability for the vulnerabilities identified and any missed internal findings that led to the unauthorized access.”

Yesterday, the U.S. Federal Housing Finance Agency (FHFA) and Fannie Mae issued the following statement:

“In President Trump’s housing market, there is no room for fraud, mortgage fraud, or any other deceitful act that can jeopardize the safety and soundness of the housing industry,” said William J. Pulte, Chairman of the Board of Directors of Fannie Mae. “Since my swearing-in, we fired over 100 employees from Fannie Mae who we caught engaging in unethical conduct, including facilitating fraud, against our great company. Anyone who commits fraud against Fannie Mae does so against the American people.”

The Federal Reserve Board has released its April 7 G.19 report on consumer credit in the month of February 2025.

During February, consumer credit decreased at a seasonally adjusted annual rate of 0.2 percent. Revolving credit increased at an annual rate of 0.1 percent, while nonrevolving credit decreased at an annual rate of 0.3 percent.