Policy Updates

Hensarling’s Choice Act Slated for Floor Action in the House in Months

On March 1, 2017, Rep. Blaine Luetkemeyer (R-MO) told attendees of a credit union conference that the Choice Act will see floor action in the next two to three months. The Financial Choice Act is a bill sponsored by House Financial Services Chairman Jeb Hensarling (R-TX) that seeks to undo parts of the 2010 Dodd Frank law. A major reform of the CFPB is included, however, the bill will likely be altered once the Senate takes it up.

Trump Cabinet Confirmation Tracker – Updated

As of Feb. 28, 2017, The Trump Cabinet is largely in place, but many vacancies remain. Visit the nomination tracker for the latest updates.

NACHA Hosts British Consulate’s Office Trade Mission

On Feb. 27, 2017, NACHA hosted a trade group representing the UKs Department for International Trade. The meeting focused on ACH and Financial Innovation. The delegation learned about NACHA’s role in the ACH Network, Same Day ACH, Elevation and the Payments Innovation Alliance. After the meeting, the British delegation flew to the Federal Reserve Bank of Atlanta for a payments symposium that included Mike Herd from NACHA speaking in detail about faster ACH payments.

NACHA Addresses CUNA Payments Policy Subcommittee Meeting

On Feb. 27, 2017, NACHA presented to the CUNA Payments Policy Subcommittee Meeting, which was held in Washington DC. Topics included newly released Same Day ACH volume and statistics, Same Day ACH Phase 2, America Saves Week and split deposit promotion and new options for Credit Unions who wish to originate Same Day ACH.

NACHA Attends First Congressional Fintech and Payments Caucus Briefing

On Feb. 24, 2017, NACHA attended the first Congressional Fintech and Payments Caucus briefing of the 115th Congress – entitled Fintech 101. The briefing looked at how the financial and technology industries are coming together to innovate new ways to bank, save for retirement and make payments. The topics included equity crowdfunding, marketplace lending, robo-advisers and payments. Confirmed panelists included:
  • Rob Morgan, VP Emerging Technologies, ABA
  • Amie J. Woeber, Federal Government Relations Manager, PayPal
  • Jesse Silverman, Head of Regulatory, LendUp
  • Campbell Gibson, Head of Public Policy, Avant

GAO Releases Report on Treasury’s Use of Financial Agents

On Feb. 24, 2017, the Government Accountability Office (GAO) released a report entitled Revenue Collections and Payments: Treasury Has Used Financial Agents in Evolving Ways but Could Improve Transparency in response to a request for GAO review of the Department of the Treasury’s use of financial agents. In the report, the GAO reviewed:
  • “How Treasury’s use and compensation of financial agents has changed as it has modernized its payment and collection systems.”
  • “Fiscal Service’s process and related internal controls for selecting and designating financial agents.” 

Concluding the report, the GAO’s recommendation is that information regarding Treasury’s financial agents, (including compensation and services provided) should be disclosed publicly, in a centralized location.

NACHA Talks Split to Save

Workers are not saving enough to cover emergencies and planned expenses that crop up on an annual basis. Despite the proven financial benefits of Direct Deposit and Split Deposit – the ability to automatically direct a fixed percentage of pay into a savings or investment account – many of our nation’s workers are not taking advantage of this free tool to help increase savings. Currently, 82 percent of the nation’s workers receive Direct Deposit of their pay, but only 24 percent use Split Deposit – one of the easiest ways to grow savings over time.

On Feb. 23, 2017, NACHA GR staff led a complimentary webinar on the “Split to Save” campaign, which is designed to empower businesses, nonprofits and others to help workers increase their personal savings and build wealth through Split Deposit. Also, the campaign has made available a “Split to Save” Toolkit to encourage more Direct Deposit and Split Deposit use to obtain savings goals. In addition to the kickoff webinar, GR staff is promoting the campaign to Congressional staff to encourage savings among staffers on Capitol Hill.


Senate Committee Rosters Completed

As of Feb. 21, 2017, The Committee assignment process in the Senate is complete. See the Roster for a listing of Senate Committee membership.

CFPB Granted Rehearing of Court Ruling

On Feb. 16, 2017, The U.S. Court of Appeals for the District of Columbia Circuit’s full bench issued an order to review an October 2016 ruling in the case of PHH Corp. v. CFPB, which found the Consumer Financial Protection Bureau’s leadership framework constitutionally flawed and permitted the White House to dismiss CFPB’s Director, Richard Cordray, for any reason. This new ruling is seen as a setback for the bureau’s critics as it could make removal of Director Cordray more difficult.

NACHA Submits Comments on Enhanced Cyber Risk Management Standards

On Feb. 13, 2017, NACHA – The Electronic Payments Association (“NACHA”) provided comments on the joint Advance Notice of Proposed Rulemaking (the “ANPR”) regarding enhanced cyber risk management standards published by the Board of Governors of the Federal Reserve System (“Board”), the Office of the Comptroller of the Currency (“OCC”), and the Federal Deposit Insurance Corporation (“FDIC”) (collectively the “Agencies”).

Comments on 12 NYCRR Part 192 governing the Methods of Payment of Wages, from APA, NACHA & AFP

On Feb. 10, 2017, The American Payroll Association, NACHA – The Electronic Payments Association, and the Association of Financial Professionals filed comments with the New York Department of Labor on the notice and consent templates posted by the New York State Department of Labor on Jan. 19, 2017, in connection with its Final Rule on Methods of Payment of Wages, codified at 12 NYCRR Part 192.

Trump Signs Executive Order Regulating the Financial System

Feb. 3, 2017: The draft Executive Order “EO”was just signed and it requires the Treasury Secretary to consult with other members of FSOC and issue a report within 120 days that identifies laws, guidance, regulation, treaties, or other reporting and recordkeeping requirements that inhibit regulating the financial system in a manner consistent with a set of core principals identified in the EO.
The Core principals include, but are not limited to:
  • Empower Americans to make independent financial decisions;
  • Prevent taxpayer-funded bailouts;
  • Foster economic growth through rigorous regulatory analysis that addresses systemic risk and market failures;
  • Enable Americans to compete with foreign companies domestically and abroad;
  • Advance American interests in international financial regulatory negotiations;
  • Make regulation efficient, effective, and appropriately tailored;
  • Restore public accountability within financial regulatory agencies and rationalize the financial regulatory framework.

CFPB Seeks $13 Million from MasterCard and UniRush for 2015 RushCard Breakdown

On Feb. 1, 2017, the Consumer Financial Protection Bureau (CFPB) filed a consent order against MasterCard International Inc. and UniRush LLC, seeking $10 million in consumer restitution and a $3 million fine for a 2015 technological breakdown involving the RushCard. During the service disruption, thousands of economically vulnerable prepaid-card users were denied access to their own money for days, and those who reached out for help were not provided adequate customer service. The CFPB has taken this action against what it is calling “preventable failures” through the bureau’s authority under a Dodd-Frank Act provision regarding “unfair, deceptive, or abusive acts or practices" (UDAP).

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CFPB Releases Small Entity Compliance Guide for Prepaid Rule

On Jan. 31, 2017, The CFPB released the Small Entity Compliance Guide for Prepaid Rule, a document that seeks to explain the final rule – which was issued by the Bureau on Oct. 5, 2016.  The summaries, charts, and reference materials offer a way to understand the rule and see which provisions are likely to apply to certain products or businesses. The Prepaid Rule is effective on Oct. 1, 2017.

Trump Signs Executive Order on Regulations

On Jan. 30, 2017, President Donald Trump signed an executive order requiring that for every new federal regulation implemented, two must be rescinded. The order, signed in the Oval Office, fulfills a campaign pledge.

NACHA Provides Comments on Federal Government Participation in ACH Network

NACHA provided comments on the notice of proposed rulemaking (the “Proposed Rule”) regarding the Federal Government Participation in the Automated Clearing House (“ACH”), which was published by the Department of the Treasury, Bureau of the Fiscal Service (the “Fiscal Service”) on November 30, 2016. Title 31 CFR part 210 (“Part 210”) governs the use of the ACH Network by Federal agencies, and incorporates the NACHA Operating Rules (“NACHA Rules”) published by NACHA, with certain exceptions. The Proposed Rule would amend Part 210 to incorporate 2014, 2015 and 2016 amendments to the NACHA Rules, and to identify provisions of such amendments and other NACHA Rules that would not apply to Federal agencies.

After first providing some brief background information, NACHA offered comments on the Proposed Rule attached. At the outset, however, NACHA is pleased that the Fiscal Service is agreeing to adopt most of the 2014, 2015 and 2016 amendments to the NACHA Rules, including agreeing to participate in Same Day ACH, which we believe will bring an important level of consistency and fairness to the ACH Network and all participants. NACHA offered specific comments on a few select aspects of the Proposed Rule. Specifically, NACHA believes that: (i) the Fiscal Service’s approach to adopting Same Day ACH should be modified, and (ii) three of the exceptions to the NACHA Rules that would be implemented by the Proposed Rule are inappropriate and should not be adopted. Finally, we believe that the Fiscal Service should implement a process to provide for more regular and timely adoption of NACHA Rules amendments.

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2017 Presidential Inaugural Schedule

The 2017 Presidential Inaugural weekend commences today (Jan. 19) with a wreath laying ceremony at Arlington National Cemetery. Find a schedule of events here.

Congressional FinTech and Payments Caucus Announces 115th Congress Co-Chairs

The Congressional FinTech and Payments Caucus (CFTPC) announced Congressman Patrick McHenry (NC-10) and Congressman Randy Hultgren (IL-14) will join Congresswoman Kyrsten Sinema (AZ-09) and Congressman David Scott (GA-13) as caucus co-chairs for the 115th Congress. 
 
The Congressional FinTech and Payments Caucus is an informal group of Members dedicated to innovation, growth and education in the emerging fintech space – the moniker given to the rapid technological innovation occurring in any number of financial services, such as payments, insurance, lending, deposits, and raising capital. The Caucus serves as a marketplace of ideas for Members and their staff to learn and better understand how fintech is revolutionizing the way consumers and businesses will receive financial services tomorrow.
 
NACHA Government Affairs will continue advocating on behalf of the ACH network to Caucus Members through our strong ties and engagement.

Hensarling Announces Committee Leadership Team

On Jan. 6, 2017, House Financial Services Committee Chairman Jeb Hensarling announced his new Committee Leadership Team, in which he has promoted three members to Financial Services subcommittee chairmanships for the first time. Chairman Hensarling also announced the creation of a new subcommittee that will investigate the financial support networks used by terrorists and others who threaten national security. The new subcommittee will build off of the work done by the committee’s Task Force to Investigate Terrorism Financing, which issued a report of its investigation in December.

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Congressional Payments Technology Caucus Rebrands To Reflect Expanded Purpose

Starting on Jan. 3, 2017, The House Congressional Payments Technology Caucus will officially be rebranded under a new name - The Congressional FinTech and Payments Caucus (CFTPC). According to their staff, this change reflects a new and expanded purpose to encompass all aspects of the fintech industry. The Caucus will continue to function as a bi-partisan, educational resource for Members, staff, and industry stakeholders.
 
Statement of Purpose - Congressional Fintech and Payments Caucus
The Congressional FinTech and Payments Caucus is an informal group of Members dedicated to innovation, growth and education in the emerging fintech space---the moniker given to the rapid technological innovation occurring in any number of financial services, such as payments, insurance, lending, deposits, and raising capital. The Caucus serves as a marketplace of ideas for Members and their staff to learn and better understand how fintech is revolutionizing the way consumers and businesses will receive financial services tomorrow.

Federal Reserve Board Proposes to Establish Guidelines to Broadly Outline Considerations for Evaluating Joint Account Requests at Reserve Banks

In late December, the Federal Reserve Board requested comment on proposed guidelines that would be used to evaluate requests for joint accounts at Federal Reserve Banks. The accounts are intended to facilitate settlement between depository institutions participating in U.S. payment systems.

The Federal Reserve Banks typically permit a single master account per eligible depository institution. In limited cases and for specific purposes, the Reserve Banks have in the past opened joint accounts held for the benefit of multiple depository institutions, which are managed by an agent on behalf of those depository institutions. In light of ongoing developments to improve the U.S. payment system, including the Federal Reserve’s Strategies for Improving the U.S. Payment System efforts, the Board anticipates interest by industry participants in establishing joint accounts to facilitate settlement.
 
The Board proposes to establish guidelines to broadly outline considerations for evaluating joint account requests. Requests would be evaluated on a case-by-case basis, and more specific considerations and information necessary to evaluate a particular request would likely be required based on the complexity of the arrangement and other factors.

Comments on the proposed guidelines are requested within 60 days of publication in the Federal Register Notice.


NACHA Hosts Congressional Staff Briefing on Same Day ACH: Moving Payments Faster

On Dec. 9, 2016, NACHA hosted a group of congressional staff, regulators and industry partners for a Lunch-N-Learn on Faster Payments and the exciting innovation occurring on the ACH Network since the implementation of Same Day ACH. A panel of experts reviewed newly released volume and usage statistics of Same Day ACH and how the market is innovating around this faster payment option. Representatives from NACHA, the Independent Community Bankers of America (ICBA) and North American Banking Company discussed faster payments and demoed a new payments application, the “All Payments App”, that ensures ubiquitous access to faster payments for large and small financial institutions and their customers across the country. 
 
North American Banking Company and ICBA revealed the “All Payments App” as part of the Federal Reserve Faster Payments Task Force proposal.


GRAG Webinar Series: PHH v. CFPB, 2017 Outlook / 2016 Election & Impact to Financial Services Policy

On Dec. 8, 2016, NACHA’s Government Relations Advisory Group participated in a two-part webinar series.
 
PHH v. CFPB, 2017 Outlook
The first webinar presentation was on the recent cot case that has declared the structure of the CFPB as unconstitutional, as well as scenarios for replacing Richard Cordray as head of the agency. 
 
Speaker Allyson Baker of the Venable Law Firm is a trial attorney and civil litigator with more than a decade of experience in the federal government and private practice. Ms. Baker focuses on financial services litigation and law enforcement investigations involving consumer finance, financial fraud and complex financial transactions. Ms. Baker was an Enforcement Attorney at the CFPB where she served as lead counsel in In the Matter of Discover Bank, which was one of the first enforcement actions in agency history and resulted in one of the largest agency settlements to date. She was a member of the initial team of attorneys hired to stand up the CFPB's Office of Enforcement. As part of this effort, she helped formulate policies on litigation and investigations.
View the Webinar
 
2016 Election and Impact to Financial Services Policy
The second webinar in the series was about the election results of 2016 and the impact to financial services policy. Speaker Mathew Lapinski took the group through an inside look of those in power in a post-Obama era Washington. 
 
Mat Lapinski serves as Executive Vice President for Federal Affairs at Crossroads Strategies, a bipartisan, multi-disciplinary federal relations, advocacy and advisory firm based in Washington DC. Mr. Lapinski represents a broad spectrum of clients across multiple practice areas and has over a decade of advocacy experience in the complex corridors of Washington’s federal legislative and regulatory institutions.
View the Webinar

Obama Administration Updates Guidelines Re: Conference Spending

On Nov. 25, 2016, the Office of Management and Budget (OMB) issued a memo with updated (relaxed) guidelines regarding conference attendance of federal employees, marking the first change of its kind in in four years. This change may impact associations positively.
 

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U.S. Treasury Proposes to Adopt Same Day ACH, Targets August 2017 to Begin Receiving Same Day ACH Credits

The Department of the Treasury, Bureau of the Fiscal Service (Fiscal Service) published a proposal to amend its regulation governing the use of the Automated Clearing House (ACH) Network by Federal agencies. The proposed regulation adopts, with some exceptions, the NACHA Operating Rules as the rules governing the use of the ACH Network by Federal agencies.
 

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OCC TO GRANT NATIONAL BANK CHARTER STATUS TO FINTECH FIRMS​

The U.S. Office of the Comptroller of the Currency (OCC) is to begin accepting applications from fintech companies to become special-purpose national banks. Comptroller of the Currency Tom Curry announced the decision in a speech at Georgetown University Law School on Dec. 2, 2016, and said it is "in the public interest to move forward with chartering because fintech can expand financial access and deliver products like loans and payments in a potentially safer and more efficient way.”
 
A white paper was released which discusses the issues and conditions that will be considered in granting special purpose national bank charters, and will be open for comment through Jan. 15, 2017.

TRUMP SELECTS STEVE MNUCHIN FOR TREASURY NOMINEE​

The Trump Transition Team announced Steve Mnuchin as their Treasury Nominee. A major focus will be the roll back of Dodd-Frank, which he contends crimps bank lending, as well as a simplification of financial regulation. 
 

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House Democratic Leader Nancy Pelosi Prevails in Democratic Leadership Election

House Democratic Leader Nancy Pelosi has defeated a challenge from Rep. Tim Ryan to remain the leader of the Democratic Party in the House for the 115th Congress. The vote was 134-63 via secret ballot. Several of Ryan’s proposals were adopted in the vote, which include expanded leadership positions for freshman members. 

CFPB Appeals Courts Decision in PHH v. CFPB

On Nov. 18, the CFPB petitioned the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) for an en banc review of PHH v. CFPB. The petition, which was expected, argues that this case represents “what may be the most important separation-of-powers case in a generation.” Last month, the appeals court panel declared the bureau "unconstitutionally structured" and said it put too much power in a single director. It placed the bureau under the authority of the president.
 

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CFPB Holds Field Hearing in Order to Seek Information on Consumer Data Access

The CFPB on Nov. 17 held a field hearing in Utah on the growing debate over the future of finance: who controls the consumer data that's vital to both startups and traditional financial companies. The issue is that third-party financial aggregators, who enable customers to view financial data from multiple accounts and institutions in a single place, complained that banks were preventing access to data. Representatives for tech firms, and most consumer advocates, have longed lobbied hailed for access and praised the CFPB's inquiry. The CFPB has issued an RFI into consumer access and the sharing of financial records. This could be the first step toward rulemaking in the governance of financial data.

NACHA Meets with Reserve Bank Operations and Payments Systems Staff

Jan Estep, Mike Herd and Bill Sullivan met with Federal Reserve’s Reserve Bank Operations and Payment Systems staff as part of the quarterly meeting schedule on November 14th. A portion of the meeting included dialogue with Fed staff on the recent joint advance notice of proposed rulemaking. The ANPRM breaks the enhanced cyber-risk standards into five categories. Category 1: Cyber Risk Governance, Category 2: Cyber Risk Management, Category 3: Internal Dependency Management, Category 4: External Dependency Management, Category 5: Incident Response, Cyber Resilience, and Situational Awareness.