Like most industries today, Consumer Finance Services businesses are being significantly impacted by the novel coronavirus (COVID-19). Troutman Pepper has developed a dedicated COVID-19 Resource Center to guide clients through this unprecedented global health challenge. We regularly update this site with COVID-19 news and developments, recommendations from leading health organizations, and tools that businesses can use free of charge.

To help you keep abreast of relevant activities, below is a breakdown of some of the biggest COVID-19 driven events at the federal and state levels to impact the Consumer Finance Services industry this past week:

Federal Activities

State Activities

Privacy and Cybersecurity Activities

Federal Activities:

• On August 21, 2020, U.S. Secretary of Education Betsy DeVos implemented President Donald Trump’s memorandum extending relief on federally held student loans to borrowers through the end of the year. The Coronavirus Aid, Relief, and Economic Security (CARES) Act passed earlier this year suspends payments on federally held student loans until September 30, 2020. The memorandum directed Secretary DeVos to “provide such deferments to borrowers as necessary to continue the temporary cessation of payments and the waiver of all interest on student loans held by the Department of Education until December 31, 2020.” For more information, click here.

• On August 21, 2020, the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration, and the Office of the Comptroller of the Currency issued a joint statement clarifying that Bank Secrecy Act due diligence requirements for customers who may be considered “politically exposed persons” (PEPs) should be commensurate with the risks posed by the PEP relationship. For more information, click here.

• On August 21, 2020, the U.S. Department of the Treasury published a fact sheet on Treasury’s role as lender to the U.S. Postal Service (USPS). The fact sheet emphasized that Treasury and the USPS signed a $10 billion mutually agreeable term sheet in lending authority pursuant to the CARES Act. For more information, click here.

• On August 20, 2020, the U.S. Food and Drug Administration (FDA) issued a series of warning letters to firms marketing and selling potentially fraudulent consumer health products that claim to prevent, treat, mitigate, diagnose or cure COVID-19. The recent action is part of the FDA’s broader initiative aimed at protecting consumers from firms selling unapproved products and making false or misleading claims, including, by pursuing warning letters, seizures, injunctions or criminal prosecutions against products and firms or individuals that violate the law. For more information, click here.

• On August 19, 2020, 15 Democratic Senators wrote a letter to the Director of the Federal Housing Finance Agency expressing concern over the announcement that “Fannie Mae and Freddie Mac (the Enterprises) will begin charging an additional 50 basis points in up-front fees for all refinance loans delivered to the Enterprises on or after September 1, 2020.” The senators are concerned the raised fee will make it more expensive for homeowners to refinance their mortgages in the midst of the COVID-19 pandemic and corresponding economic downturn. For more information, click here.

• On August 19, 2020, the Federal Reserve Board and the Federal Open Market Committee released the minutes of the Committee meeting held on July 28-29, 2020. The minutes indicate that, even as fears of COVID-19 resurgence grew, broad equity price indexes remained roughly flat. During this period, however, treasury yields, and other sovereign yields declined, and the U.S. dollar weakened. For more information, click here.

• On August 14, 2020, President Trump signed a bill amending the Servicemembers Civil Relief Act (SCRA) to expand lease protections for servicemembers involved in the response to COVID-19. For more information, click here.

State Activities:

• On August 20, 2020, the Supreme Court of Virginia issued its Ninth Order Extending Declaration of Judicial Emergency in Response to COVID-19 Emergency. The order states that the moratorium against issuing writs of eviction pursuant for failure to pay rent will cease to have effect after September 7, 2020. For more information, click here.

• On August 19, 2020, the Tennessee Department of Commerce and Insurance (TDCI)’s Securities Division announced its participation in the COVID-19 Enforcement Task Force, an international investor protection initiative to crack down on schemes related to the ongoing COVID-19 pandemic. The North American Securities Administrators Association (NASAA), of which Tennessee is a member, is coordinating the task force. For more information, click here.

• On August 14, 2020, New York Attorney General Letitia James extended a moratorium on collecting certain debts that are owed to the State of New York. The order pertains to medical debt owed to state hospitals, student loans owed to SUNY campuses, and debt related to oil spill cleanup, removal, property damage, and breach of contract owed to state agencies. The new order remains in effect until September 4. For more information, click here.

• On August 13, 2020, three Oregon banks and a trade association filed a declaratory action requesting relief from state legislation alleged to retroactively apply lending obligations more onerous than the CARES Act. The state legislation, House Bill 4204, applies to lenders of commercial and residential loans secured by real estate in Oregon and creates restrictions against lending activity, imposes affirmative obligations upon lenders, and creates a private cause of action for borrowers. For more information, click here.

• On July 28, 2020, Nevada’s Department of Business and Industry (Department) confirmed that a waiver that permitted telework for mortgage company employees has expired. Earlier this year, the department allowed mortgage company employees to telework as the result of the COVID-19 pandemic. For more information, click here.

Privacy and Cybersecurity Activities:

• On August 20, 2020, the Cybersecurity and Infrastructure Security Agency (CISA) released a joint statement with other security agencies regarding the Election Infrastructure Government Coordinating Council. The Committee is “better prepared than ever before[,]” as many individuals plan to change how they vote during the pandemic. Officials are “swiftly adapting their operations to ensure every voter is able to cast a ballot in a safe and secure manner.” To read the full statement, click here.

• On August 20, 2020, it was reported that various groups, including Consumer Reports, are calling on California lawmakers to ban contact-tracing data use for commercial purposes, including targeted advertising. The calls arise as contact-tracing apps are making their way into individuals’ pockets. To read the full report, click here.

• On August 20, 2020, the PCI Security Standards Council revised the implementation dates for PCI P2PE Security Requirement 18-3. The changes are made due to “the impact COVID-19 has had on implementations[.]” The new dates for:

• • Phase 2 (Implement Key Blocks for external connections to Associations and Networks) is January 1, 2023.
  • Phase 3 (Implement Key Block to extend to all merchant hosts, point-of-sale (POS) devices, and ATMs) is January 1, 2025.

    For the full notification, click here.

• On August 19, 2020, the Federal Trade Commission (FTC) will be working with the U.S. Census Bureau to help guard against potential scams related to the 2020 Census. For those who have not responded, Census officials will be visiting homes to help complete the count. Due to COVID-19, officials are concerned that bad actors wearing facemasks will use them as a disguise to scam the public. Click here to check out the FTC’s guidance to avoid potential scams.

• On August 18, 2020, CISA updated its guidance, due to new COVID-19 developments, for the Essential Critical Infrastructure Workers Guidance. The updates provide guidance on “how jurisdictions and critical infrastructure owners can use the list to assist in prioritizing the ability of essential workers to work safely while supporting ongoing infrastructure operations across the nation.” For additional information, click here.

• On August 17, 2020, the FTC shared best marketing principles from the International Consumer Protection Enforcement Network (ICPEN). The FTC and parents know that “kids spend a huge amount of time online, especially now with COVID-19 school and camp closures.” The FTC recommends that business leaders check out ICPEN’s best practicesso they “can understand the range of issues that concern consumer protection agencies and the variety of approaches they use to ensure marketing to children online complies” with regulations. To check out the FTC’s post, click here.

• Reports are coming in that school districts, health departments, and state agencies across the country are unsure whether they can release COVID-19 figures to the public, despite current federal guidance. Leaders refer to medical and educational privacy laws as placing restrictions on their ability to release data.
  • For example, on August 20, 2020, Governor of Tennessee, Bill Lee, said during a press conference that he wants to make school COVID-19 figures open to the public. Governor Lee is currently seeking permission from the federal government to specifically “include individual school numbers.” To read the full report discussing Governor Lee’s statements, click here.