To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week:

Federal Activities

State Activities

Federal Activities:

• On July 15, the U.S. Department of Housing and Urban Development (HUD) announced that it has charged multiple entities with housing discrimination for issuing a biased appraisal and then denying a refinance loan application in Denver, CO. HUD’s charge against the appraiser, Maksym Mykhailyna; the appraisal company, Maverick Appraisal Group; the appraisal management company, Solidifi U.S. Inc.; and the lender, Rocket Mortgage, LLC, alleges that the appraiser issued a discriminatory appraisal that undervalued a Black homeowner’s property on the basis of her race. The charge further alleges that, when the homeowner complained to Rocket Mortgage, Rocket Mortgage would only proceed with her refinance loan application based on the appraised value that she alleged was discriminatory. For more information, click here.
• On July 11, the Federal Financial Institutions Examination Council (FFIEC) published data on 2023 mortgage lending transactions reported under the Home Mortgage Disclosure Act (HMDA) by 5,113 U.S. financial institutions, including banks, savings associations, credit unions, and mortgage companies. For more information, click here.
• On July 11, the Commodity Futures Trading Commission (CFTC) and the Department of Justice’s (DOJ) Computer Crime and Intellectual Property Section’s National Cryptocurrency Enforcement Team (NCET) announced that they convened the first Fraud Disruption Conference to discuss ways to mitigate fraud commonly known as “pig butchering.” For more information, click here.
• On July 11, the U.S. Department of the Treasury and Internal Revenue Service (IRS) announced that a new initiative to collect past-due tax debt from high-income, high-wealth individuals has reached a major milestone, with more than $1 billion recovered. This new initiative is funded by President Biden’s Inflation Reduction Act. In 2023, the IRS launched a new initiative to pursue high-income, high-wealth individuals who have failed to pay recognized tax debt, with dozens of senior employees assigned to these cases. This campaign is concentrated among taxpayers with more than $1 million in income and more than $250,000 in recognized tax debt. For more information, click here.
• On July 10, the Consumer Financial Protection Bureau (CFPB) proposed new and, in some cases, streamlined rules governing what mortgage servicers must do after a borrower becomes delinquent. The proposed rules incorporate some pandemic-era practices, such as allowing servicers to offer assistance without a comprehensive review of the borrower’s financial situation. According to the CFPB, the new rules would require mortgage servicers to prioritize loss mitigation over foreclosing, reduce paperwork requirements, improve communication with borrowers, and ensure critical information is provided in the borrowers’ preferred language. For more information, click here.
• On July 10, Acting Comptroller of the Currency Michael J. Hsu discussed ways banks can assist their customers in avoiding fraud and scams during his remarks at the Financial Literacy and Education Commission’s Public Meeting. For more information, click here.
• On July 9, Hiro Systems PBC (Hiro) announced that it was informed by the Securities and Exchange Commission (SEC) that the SEC does not intend to recommend an enforcement action against Hiro. Hiro is the developer of Stacks, a Bitcoin scaling solution. Notably, as of January 20, 2021, Hiro has believed that $STX, the native token of Stacks, is not an investment contract under federal securities laws because Hiro is “no longer in the position of providing … essential managerial services to the Stacks Blockchain.” For more information regarding the SEC’s no-action decision, click here. For more information about Hiro’s January 20, 2021 opinion, click here.

State Activities:

• On July 5, the California Privacy Protection Agency issued a notice of proposed rulemaking, beginning the formal rulemaking process for adopting regulations related to data broker registration authorized by the state’s Delete Act. Among other things, the proposed regulations (a) explain what it is included in, and how to pay the data broker registration fee; (b) define certain terms included in the Delete Act; and (c) clarify requirements for registration, updates to the registry, and website disclosures. Overall, the proposed rules are intended to address common questions and obstacles that data brokers tend to experience during the initial registration period. For more information, click here.
• Florida Governor Ron DeSantis recently signed HB 1347 into law, a bill related to consumer finance loans. Among other things, the bill requires branches of businesses making consumer finance loans to obtain a license. Additionally, the bill adjusts the interest rate cap for consumer loans (maximum 36% on first $10,000 of principal; maximum 30% on principal exceeding $10,000 and up to $20,000; 24% maximum on principal exceeding $20,000 and up to $25,000). The bill also revises the minimum amount of time before a delinquency charge can be imposed (increased to 12 days from 10 days). Further, the bill requires licensees to offer borrowers credit education programs or seminars. The bill went into effect on July 1. For more information, click here.