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The staff of the Federal Trade Commission has provided its annual report to the Consumer Financial Protection Bureau on its enforcement and related activities in 2023 on the Truth in Lending Act (TILA), Consumer Leasing Act (CLA), and Electronic Fund Transfer Act (EFTA).

The report highlights the FTC’s enforcement actions and initiatives under these laws and their implementing regulations, including in the areas of automobile financing and leasing, payday lending, other credit and leasing, and electronic fund transfers.

• Press release

Acting Comptroller of the Currency Michael J. Hsu discussed recovery planning via livestream in remarks May 27 at the Entrepreneurship, Markets and Technology: Regulation's Challenges in a Changing World Conference in Zurich, Switzerland.

In his remarks, Mr. Hsu discussed the importance of recovery planning and how it can mitigate the too-big-to-fail problem. He highlighted the importance of recovery planning at large banks in the context of the bank failures in March 2023 and offered thoughts on expanding recovery planning guidelines to apply to banks with at least $100 billion in assets.

The Federal Reserve Board on Tuesday released the minutes from its recent meetings to review and determine the discount rates provided to depository institutions through the discount window. Today's minutes cover the Board meetings that occurred on April 8 through May 1, 2024.

The FDIC on Friday issued FIL-27-2024 with steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Texas affected by severe storms, straight-line winds, tornadoes, and flooding on April 26, 2024, and continuing.

The affected areas are Harris, Liberty, Montgomery, Polk, San Jacinto, Trinity, and Walker Counties.

The Federal Housing Administration's Mortgagee Letter 2024-10, issued yesterday, requires FHA-approved mortgagees to notify HUD when a cyber incident occurs. The letter, effective immediately, applies to all FHA insurance programs.

The mortgagee letter adds a new section, Significant Cybersecurity Incident, which requires FHA-approved mortgagees to report cyber incidents to HUD within 12 hours of detection. Reports will be made to HUD's FHA Resource Center and to HUDs Security Operations Center.

The FDIC yesterday issued FIL-26-2024 announcing revisions to Call Reports and the FFIEC 002 Report as published [89 FR 45046] on May 22, 2024, in the Federal Register.

Proposed changes were issued on September 28, 2023 (FIL-52-2023) and December 27, 2023 (FIL-68-2023). After considering the comments received on these notices, the agencies are moving forward with certain proposed revisions related to replacing references to “troubled debt restructurings” with “modifications to borrowers experiencing financial difficulty” consistent with ASU 2022-02, the reporting on the internet website addresses of depository institution trade names, and the adoption of the standards for electronic signatures. These updates to the Call Report and FFIEC 002 report forms and instructions will be effective as of the June 30, 2024, report date.

The agencies are implementing revisions related to reporting of loans to NDFIs as of the December 31, 2024, report date. The agencies are also adding a new Memorandum item that would identify the amounts reported as a structured financial product that are guaranteed by U.S. Government agencies or sponsored agencies, which would be effective as of the December 31, 2024, report date.

The agencies are continuing to review comment letters related to loan modifications to borrowers experiencing financial difficulty under ASU 2022-02, as well as the proposed clarification on the reporting of past due loans and proposed reporting of long-term debt requirements, for further changes to the Call Report and the FFIEC 002. Comments on the May 22, 2024, Federal Register notice will be accepted through June 21, 2024.

The OCC yesterday reported recent enforcement actions against two national banks and five institution-affiliated parties to OCC-supervised institutions.

• A formal agreement with Comerica Bank & Trust, National Association, Ann Arbor, Michigan, for unsafe or unsound practices, including those relating to the bank’s risk governance framework and internal controls
• A formal agreement with Lemont National Bank, Lemont, Illinois, for unsafe or unsound practices, including those relating to capital planning, strategic planning, succession planning, and liquidity risk management
• An order of prohibition against Stanley Acosta, a former senior specialist relationship banker at a Dartmouth, Massachusetts, branch of Santander Bank, N.A., Wilmington, Delaware, for stealing approximately $27,449 from cash deposit bags that customers provided to the bank via the night deposit vault
• An order of prohibition against Bahtia Greene, a former associate operations processor at the Philadelphia, Pennsylvania, lockbox facility for Wells Fargo Bank, N.A., Sioux Falls, South Dakota, for misappropriating confidential information of bank customers and selling the information to a third party, resulting in fraudulent transactions and a loss to the bank of approximately $688,000
• An order of prohibition against Sabina Prince, former teller at a Mountain Brook, Alabama, branch of PNC Bank, National Association, Wilmington, Delaware, for taking $15,000 in cash from the bank and manipulating cash shipment processing receipts to hide her actions
• An order of prohibition against Stephanie Sanders, former relationship banker at NBT Bank, N.A., Norwich, New York, for misappropriating approximately $30,650 from the bank by crediting her checking and savings accounts over 100 times
• A notice of charges for Gerald E. Milligan, II, a former teller at a Royal Palm, Florida, branch of PNC Bank, N.A., Wilmington, Delaware. The Notice of Charges alleges, among other things, that Milligan knowingly made false attestations and provided false supporting documentation for a Paycheck Protection Plan (PPP) loan application, received PPP loan proceeds in the amount of $141,530, and used the funds for personal gain.

The FDIC yesterday published its 2024 Risk Review, which provides an overview of banking conditions in 2023 in five broad categories: market risks, credit risks, operational risks, crypto-asset risks, and climate-related financial risks. The market risks areas discussed are liquidity, deposits and funding, and net interest margins and interest rate risk. The credit risks areas discussed are commercial real estate, residential real estate, consumer, agriculture, small business, corporate debt and leveraged lending, nonbanks, and energy.

The discussion of operational risks examines the potential negative impact to banks from cyber threats and illicit activity. The crypto-asset risks section discusses the FDIC’s approach to understanding and evaluating crypto-asset-related markets and activities. The discussion of climate-related financial risks focuses on the physical risk of severe weather and climate events to the banking system.

Monitoring these risks is among the FDIC's top priorities.

The Federal Reserve has posted the Minutes of the Federal Open Market Committee held on April 30 and May 1, 2024.

The CFPB this morning issued an interpretive rule that confirms that Buy Now, Pay Later (BNPL) lenders are credit card providers. Accordingly, BNPL lenders must provide consumers some key legal protections and rights that apply to conventional credit cards. These include a right to dispute charges and demand a refund from the lender after returning a product purchased with a BNPL loan. The CFPB launched its inquiry into the rapidly expanding BNPL market more than two years ago and continues to see consumer complaints related to refunds and disputed transactions.

Under the rule, BNPL lenders will be required to:

• Investigate disputes
• Refund returned products or canceled services
• Provide periodic billing statements

The interpretive rule is applicable 60 days after its May 31, 2024, publication at 89 FR 47068 in the Federal Register (Effective date July 30, 2024). While the CFPB states that Administrative Procedures Act does not require it, the Bureau is opting to collect comments on the rule and may make revisions after reviewing any feedback. Comments will be accepted on the rule through August 1, 2024.
Update: Federal Register publication information and effective date have been added. References to a "proposal" have been removed; the interpretive rule was issued to become effective as published, but may be revised after the CFPB reviews the feedback it receives.