NACHA Government Relations Update - Feb. 8, 2018

Posted February, 5 2018

Powell Becomes Federal Reserve Chair on Feb. 5
On Feb. 5, 2018, Jerome Powell becomes Chair of the Board of Governors of the Federal Reserve System, replacing Chair Janet Yellen. Yellen will step down from the Federal Reserve altogether once Powell is sworn in, which will leave the seven-member Board temporarily with only three Governors — an unprecedented occurrence.
The incoming Chairman, who has sat on the Fed’s Board since 2012, was confirmed by the Senate for his new role on Jan. 23.
CFPB Structure Ruled Constitutional
On Jan. 31, 2018, the full Court of Appeals for the District of Columbia Circuit ruled (7-3) that the Consumer Financial Protection Bureau’s structure is constitutional, thus reversing its previous decision in favor of PHH Corp. The ruling states that the President can only fire the head of the bureau for neglect or wrongdoing (not simply for any reason), affirming the agency’s independence. U.S. Circuit Judge Nina Pillard wrote that permitting the President to have more leeway in reasons that he could fire the Director “would put the historically established independence of financial regulators and numerous other independent agencies at risk”.
It is expected that the Trump administration and PHH Corp will appeal this decision to the U.S. Supreme Court.
House Passes Online Banking Bill
The House passed a bill that would require states to allow consumers to open bank accounts online with scanned copies of their driver's licenses or other identification. H.R. 1457, “The Mobile Act,” makes it easier for banks to implement new mobile technologies by clarifying that institutions may utilize images of a consumer’s drivers license or government-issued ID to open an account. The bill has broad, bipartisan support. The bill has yet to be voted on in the Senate but similar language is contained in the bi-partisan bill, S.2155 that is expected to advance through the Senate in 2018.
Congressional Research Service Examines Federal & State Banking Oversight 
This report provides an overview of the respective roles of the federal government and the states in regulating banking. The report begins by providing a general overview of the doctrine of federal preemption, before discussing the American "dual banking system." It then addresses several key areas where preemption issues have arisen with respect to banking law, including (1) the standard for implied preemption of state laws that interfere with the powers of national banks adopted by the Supreme Court in Barnett Bank; (2) the Court's decisions in two cases concerning "visitorial powers" over national banks, and (3) interpretive letters and rules concerning federal preemption issued by the OCC. The report also discusses the provisions in Dodd-Frank concerning preemption of state consumer protection laws, and their interpretation by courts and the OCC. Finally, the report concludes by discussing issues that are likely of interest to the 115th Congress concerning preemption, including provisions in the Financial CHOICE Act of 2017. 
Legislative Calendars for 2018
House 2018 Calendar
Senate 2018 Calendar
Access: Public