Rulemaking & Guidance

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On February 1, NY DFS announced the adoption of the final regulation implementing the New York State Commercial Finance Disclosure Law (CFDL) (N.Y. Fin. Serv. Law §§ 801 to 812). The regulations require companies that offer commercial financing less than or equal to $2.5 million (providers) to make standardized disclosures about the commercial financing’s credit terms to recipients of the commercial financing (recipients). The final regulations were effective February 1, 2023, and the compliance date for the final regulation is August 1, 2023 (see our previous post on the regulations here).…

Continue Reading New York Adopts Final Commercial Financing Disclosure Regulations

On January 23, the NY DFS released updated guidance with regard to better protecting consumers in the event of virtual currency insolvency. This updated guidance applies to entities that DFS has licensed or chartered to hold or maintain virtual currency assets on behalf of their customers. The guidance reiterates that as custodians, such entities must have practices in place to maintain custody and control of virtual currency similar to that of traditional financial service providers. DFS’ previous guidance already required certain practices, such as maintaining books and records, disclosure of certain terms, and protections in place for the assets held. The new guidance sets forth additional requirements and most pertinently, custodians must:…

Continue Reading NY DFS Releases Custodial Guidance on Crypto Insolvency

On January 19, the CFPB issued Circular 2023-01 to affirm that companies offering “negative option” subscription services are required to comply with federal consumer financial protection laws. According to the Circular, “negative option” refers to a term or condition under which a seller may interpret a consumer’s silence, failure to take an affirmative action to reject a product or service, or failure to cancel an agreement as acceptance or continued acceptance of the offer (see our previous blog posts on negative option marketing here and here). The CFPB warns that negative option marketing practices may violate the prohibition on unfair, deceptive, or abusive acts or practices in the CFPA where a seller:…

Continue Reading CFPB: Negative Option Marketing Practices May Violate CFPA

On December 18, the Arizona Attorney General issued an opinion on earned wage access (EWA), which determined that fully non-recourse EWA products do not constitute consumer loans subject to consumer loan regulations, and correspondingly, that providers of non-recourse EWA products would not be considered consumer lenders subject to licensure under Arizona law. The opinion found that an EWA product could be identified as fully non-recourse when the provider:…

Continue Reading AZ Attorney General Concludes Non-Recourse EWA Not a Loan

On April 28, the FTC proposed updating the Telemarketing Sales Rule (TSR) to extend protections against telemarketing tricks and traps to small businesses and to strengthen defenses against other telemarketing schemes that negatively impact consumers. The agency is seeking public comments on the proposed changes to the rule.
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Continue Reading FTC Proposes Updates to Telemarketing Sales Rule, Business to Business Exemption in Order To Protect Small Businesses

On January 20, the Federal Reserve (Fed) released a much-anticipated discussion paper examining the pros and cons of a potential U.S. central bank digital currency (“CBDC”). To fully evaluate a potential CBDC, the Fed asks for public comment on more than 20 questions. Comments will be accepted for 120 days and can be submitted here.
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Continue Reading Federal Reserve Examines Pros and Cons of a Central Bank Digital Currency

Section 1033 of the Dodd-Frank Act states that consumers have the right to access their own bank account and transaction data in a usable electronic format.  This provision mandates that the CFPB adopt a rule relating to data access.  However, the timeline for this rule has been fluid, in part due to the CFPB’s full agenda and the time needed by Rohit Chopra, the CFPB’s new director and a former member of the Federal Trade Commission, to make his own determinations about the rule.
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Continue Reading CFPB Likely to Delay Data Sharing Rule Until 2023