MVA White Collar Defense, Investigations, and Regulatory Advice Blog

On June 1, six Federal financial regulatory agencies[1] (Agencies) jointly issued a Notice of Proposed Rulemaking (the Proposed Rule) requiring the implementation of quality control standards for the use of automated valuation models (AVMs) to estimate the value of real estate. The standards would apply to AVMs used by mortgage originators and secondary market issuers in determining the collateral value of a mortgage secured by a consumer’s principal dwelling. The rulemaking was required by Section 1473(q) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ...

The Consumer Financial Protection Bureau (CFPB) issued releases in May and June that reflected their continued focus on consumer protection issues associated with both bank fees and the use of artificial intelligence (AI) by financial institutions. On May 10, 2023, the CFPB issued Circular 2023-02 (the Circular) advising that a financial institution’s unilateral reopening of a deposit account to process a debit or deposit received after account closure can constitute an unfair act or practice under the Consumer Financial Protection Act (CFPA). On June 6, 2023, the CFPB ...

Moore & Van Allen (MVA) Members John Fagg and Jim McLoughlin, both Lawdragon 500 Leading Litigators and Chambers-ranked practitioners, recently provided commentary to Lawdragon regarding the White Collar Enforcement Under the Biden Administration. They provided their take on the Administration’s enforcement efforts so far, and what might be coming down the pipeline as the Biden Administration follows through on campaign promises to pursue more white collar criminal cases. Federal prosecutors have been pursuing COVID-related frauds, giving ...

Executive Summary

The Consumer Financial Protection Bureau (the “CFPB”) has published a final rule implementing the requirements of Section 1071 of the Dodd-Frank Act (the “Final Rule”), which mandated data collection on certain credit applications to facilitate enforcement of fair lending laws and the identification of business and community development needs and opportunities for women-owned, minority-owned, and Small Businesses. Section 1071 directed the CFPB to implement rules necessary to carry out, enforce, and compile these data collection ...

The Federal Reserve Board (“FRB”) rarely issues denials for applicants to become members of the Federal Reserve System. Senator Elizabeth Warren has even criticized the FRB for their number of approvals – although in the context of bank mergers. Last Friday Custodia Bank (state chartered in Wyoming) received such a denial. Custodia Bank was formed to be “a compliant bridge between digital assets and the U.S. dollar payments system” and a digital asset custodian.

One of the difficulties digital asset companies, like Custodia Bank, have faced is being able to access the ...

In December 2021, the Bureau of Consumer Financial Protection (or the “CFPB”) issued a notice and request for comment (the “Notice”) on its intention to make a preemption determination regarding the Truth in Lending Act (“TILA”) and the State of New York’s Commercial Financing Law, which imposes disclosure requirements on certain commercial lending transactions (the “New York CFL”). The preemption determination had been requested by the Small Business Finance Association (the “SBFA”), a non-profit advocacy organization for its members who provide ...

In 2020, we wrote about the increased regulatory attention on financial institutions’ obligations to detect and respond to human trafficking. In 2021, we wrote about how anti-human trafficking programs fit squarely in banks’ risk management and ESG platforms. As 2022 comes to a close, we add to these alerts an area of emerging potential bank liability – civil actions alleging failure to detect and respond to human trafficking.  

A few weeks ago, two sex trafficking survivors filed lawsuits against two international financial institutions including claims under the ...

Most entities formed or registered to do business in the U.S. will, beginning January 1, 2024, be required to self-report beneficial ownership information to the U.S. Treasury’s Financial Crimes Enforcement Network (“FinCEN”). The new federal database, to be known as “BOSS” (Beneficial Ownership Secure System), is not yet online, but FinCEN on Friday, September 30 published the final regulations[1] implementing beneficial ownership information disclosure requirements pursuant to the Corporate Transparency Act (“CTA”)[2] passed by Congress in 2021 ...

On August 11, 2022, the Consumer Financial Protection Bureau (“CFPB”) issued a circular (Circular 2022-04 or, the “Circular”) addressing whether insufficient data and information security practices can violate the prohibition against unfair acts or practices in the Consumer Financial Protection Act (“CFPA”). The CFPB concluded that inadequate security practices could give rise to a claim not only under federal data security laws like the Gramm-Leach-Bliley Act (“GLBA”), but also under the CFPA as well. The Circular discusses the elements of a claim under the CFPA and identifies a few specific practices that the CFPB identified as likely giving rise to a violation of the CFPA. The Circular, however, does not otherwise provide direction to the industry on expected information security practices.

* Published by Westlaw Today

FINRA has continued its efforts to expand protections for “specified adults” by amending its Rule 2165.[1] Prior to the amendments, FINRA Rule 2165 allowed FINRA member firms to place temporary holds on disbursements of funds and securities in situations involving the financial exploitation of those individuals. With the amendments (which went effective on March 17, 2022), FINRA has indicated that it has created the first uniform national standard for placing temporary holds on securities transactions in the accounts of these customers in ...