NACHA Government Relations Update - Dec. 1, 2015

Posted November, 25 2015

NACHA Government Relations Creates Thought Leadership Opportunities
On Nov. 19, 2015, U.S. Rep. Blaine Luetkemeyer (R-MO) attended the NACHA Board of Director’s meeting where he offered his insights and engaged the NACHA Board of Directors in dialogue about the federal legislative priorities of the U.S. Congress and recent developments in financial services, banking and payments – including potential impact on the industry. NACHA continues to increase its resources and activities to deepen the education and engagement of federal policymakers in the legislative and regulatory areas to advocate for the ACH Network and private-sector rulemaking. 
On Dec. 3, 2015, NACHA will host a “Lunch-N-Learn” on Capitol Hill to educate Congressional staff on faster payments with emphasis on the value of Same Day ACH and private sector rulemaking. Jane Larimer of NACHA will lead the discussion with panelists Joe Hussey – Executive Director, J.P. Morgan and Chair of NACHA’s Rules and Operations Committee and Jeremy Pritchard – Senior Vice President, State Bank and Trust.
The Dec. 9 Government Relations Advisory Group (GRAG) meeting will feature CEBP Director, Richard Cordray and U.S. Rep. Bill Huizenga (R-MI) at the Capitol Hill Club. Director Cordray will be addressing the group on CFPB’s payments vision for 2016 and beyond. This will be a great opportunity for GRAG members to hear directly from one of the most powerful people in the policy space and to be able to ask Director Cordray questions after his remarks. Rep. Huizenga, another powerful payments policy voice, is a good friend of the ACH Network and recently had a bill pass the House regarding further oversight of the Federal Reserve Board (more information below.) Rep. Huizenga will also offer the chance for Q&A with GRAG.
FDIC Clarifies Approach to Banks that Offer Products and Services to Non-Bank Payday Lenders
On Nov. 16, 2015, in response to increased oversight by the U.S. Congress around activities linked to the Justice Department led program called Operation Choke Point, the FDIC reissued to all examiners FIL-14-2005, entitled “Payday Lending Programs: Revised Examination Guidance” as well as its attachment, "Revised Guidelines for Payday Lending." The guidance was reissued “to ensure that bankers and others are aware that it does not apply to banks offering products and services, such as deposit accounts and extensions of credit, to non-bank payday lenders,” according to the FDIC. Additionally, “[f]inancial institutions that can properly manage customer relationships and effectively mitigate risks are neither prohibited nor discouraged from providing services to any category of business customers or individual customers operating in compliance with applicable state and federal laws.”
House Passes the FORM Act of 2015 Designed to Further Regulate the FRB System
On Nov. 19, 2015, The U.S. House of Representatives passed H.R. 3189: Fed Oversight Reform and Modernization (FORM) Act of 2015, by a vote of 241-185. The bill, which was introduced by Rep. Bill Huizenga (R-MI) in July of this year, would enact a number of operational changes to the Federal Reserve System. Included in the bill’s mandates are Government Accountability Office (GAO) administered audits of the Fed and its monetary decisions, the Fed’s use of a rules-based monetary policy, additional transparency regarding the Fed-implemented yearly stress tests required of the country’s largest financial institutions, and restrictions of the Fed’s authority to lend emergency funding to non-banks. The U.S. Senate will be next to consider this bill.

CFPB Pushes Back Date to Issue Payday Lending Rule
On Nov. 20, 2015, the Consumer Financial Protection Bureau (CFBP) posted its Fall 2015 Rulemaking Agenda. Among items outlined in the current schedule, CFPB indicated it expects to issue a Notice of Proposed Rulemaking including the bureau’s draft rule regarding payday lending in Q1 2016 (estimate is February.) This has been pushed back from the CFBP’s initial target of “later in 2015” as stated in its Spring 2015 Agenda.

CFPB Issues Bulletin Re: Automatic Debits
On Nov. 23, 2015, the Consumer Financial Protection Bureau (CFPB) issued a bulletin on what consumers must know before automatic payments are debited out of their accounts, reminding consumers and business that the debits must be authorized and can be canceled at any time. The bureau said it has found that some companies were not giving notification on how much would be taken out or when. CFPB’s Director, Richard Cordray stated, “This bulletin makes clear that companies must get a consumer’s authorization before automatically debiting their account.” Further, “Consumers also have the right to stop these charges at any time.”
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