On January 23, 2023, the New York Department of Financial Services released guidance with the stated goal of helping to protect customers of virtual currency businesses in the event of an insolvency or similar proceeding by imposing new custody and disclosure requirements on virtual currency entities that act as custodians.  Specifically, the guidance focuses on four areas for virtual currency entities acting as custodians (or “VCE Custodians”):

  • Segregation of and Separate Accounting for Customer Virtual Currency: A VCE Custodian is expected to (1) separately account for and segregate customer virtual currency from the corporate assets of the VCE Custodian and its affiliated entities, both on-chain and on the VCE Custodian’s internal ledger accounts; (2) avoid comingling customer virtual currency with any of the VCE Custodian’s own virtual currency or with any other non-customer virtual currency; and (3) clearly and prominently disclose the manner in which the VCE Custodian segregates and accounts for customer virtual currency. 
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On September 9, 2022, the California Department of Financial Protection and Innovation (DFPI) proposed to amend its student loan servicing regulations, which we previously covered  here.  After reviewing public comments, on January 6, 2023, the DFPI released a Notice requesting an additional round of public comments on a modified set of regulations.  … Continue Reading

On December 15, 2022, the New York Department of Financial Services (“NYDFS”) published an Industry Letter detailing the Department’s guidance regarding banking organizations that wish to engage in virtual currency-related activities.  In addition to reminding banks, trust companies, private bankers, savings banks, safe deposit companies, savings and loan associations, credit unions, investment companies, branches, and agencies of foreign banking organizations licensed by the NYDFS (together, “Banking Organizations”) of their preexisting obligation to seek approval from the NYDFS before engaging in new or significantly different virtual currency-related activity in New York or with a New York resident, the guidance describes the process and types of information that the NYDFS considers in connection with its approval process.… Continue Reading

In Mortgagee Letter 2022-22 dated December 15, 2022, the FHA announced updates to its Single Family Housing Policy Handbook (HUD Handbook 4000.1) that modifies its policies governing conflicts of interest and dual employment.  The modifications both narrow the employees who are subject to the conflicts of interest policies, and subjects those employees to what appear to be more significant restrictions. … Continue Reading

The Washington Department of Financial Institutions has adopted regulations effective December 31, 2022 to implement amendments to the Consumer Loan Act permitting licensed companies to allow licensed mortgage loan originators to work from their residence without licensing the residence as a branch.

Among various amendments and clarifications to the regulations is new WAC § 208-620-660, which provides:

What is required for a Washington licensed loan originator to work from their residence without licensing the residence as a branch?Continue Reading

The New York state legislature is currently considering a pair of companion bills which would impose detailed notice and records requirements upon student loan servicers.  New York Senate bill S5136B, which was passed by the New York Senate earlier this year, and New York House bill A6226B, which is currently under consideration with the New York Legislature’s Consumer Affairs and Protection Committee, would require “creditors and debt collectors” to provide certain written disclosures to borrowers or cosigners of private education loans at the time of the first collection communication (or within five days after the first communication). … Continue Reading

On December 12, 2022, the CFPB released a proposed rule that would require certain “covered nonbanks” to register with and submit information to the CFPB when they become subject to certain  orders from local, state, or federal agencies and courts involving violations of certain consumer protection laws.  The CFPB has further proposed to make the registration information publicly available, including by publishing it on the Bureau’s website.… Continue Reading

On December 22, 2021, New York State Senate Bill 2767A was signed into law. The Bill establishes the Private Student Loan Refinancing Task Force (the “Task Force”), which was charged with “study[ing] and analyz[ing] ways lending institutions that offer non-federal student loans to students of New York institutions of higher education can be incentivized and encouraged to create student loan refinance programs.”… Continue Reading

On September 9, 2022, the California Department of Financial Protection & Innovation (the “DFPI”) released a Notice of Proposed Rulemaking Action that proposes to adopt regulations implementing the Student Loan Servicing Act (section 28100, et seq.) and the Student Loans: Borrower Rights Law (Civil Code section 1788.100, et seq.). … Continue Reading

On August 31, 2022, the California Senate voted to approve House Assembly Bill 156, and sent the bill to Governor Newsom for consideration and potential signature.  If it becomes law, the bill would amend the existing California Debt Collection Act (the “DCLA”) in three ways.

First, the bill would amend provisions of Cal.Continue Reading