Page 5 - May 23, 2024 Bulletin

aRTiCLeS

“[B]oth the OCC and the Supreme Court have repeatedly rule based on the binding Fifth Circuit ruling in CFPB vs.
recognized national banks’ incidental powers evolve alongside Community Financial Services Association of America. The rule,
financial innovations and the growing needs of an ever-more which applies to credit card issuers with at least 1 million open
complex American economy,” the associations said. “Less national accounts, reduced the safe harbor dollar amount for late fees to
banks quickly be made vulnerable to myriad, often conflicting $8, eliminated a higher safe harbor dollar amount for late fees for
state laws, the OCC must be and remain vigilant in all situations subsequent violations of the same type and eliminated an annual
in which national bank preemption is appropriate.” inflation adjustment for the safe harbor amount.
Read more: https://www.aba.com/advocacy/policy-analysis/Joint-Ltr- CFPB vs. Community Financial Services Association of America
Natl-Bank-Preemption is the ongoing case challenging the constitutionality of the
bureau’s funding. The case is currently awaiting a Supreme Court
FDIC Releases Findings on ruling that could come any time before the end of June. Because
Allegations of Misconduct at of this precedent, Pittman did not address what he called ABA
and the other plaintiffs’ “compelling” arguments under the Credit
Agency CARD Act, the Truth in Lending Act and the Administrative
Procedure Act.
The FDIC failed to provide its employees a workplace safe from
sexual harassment, discrimination and other misconduct, an Fed, CPFB Announce New
independent investigation of the agency concluded. In a report,
the law firm Cleary Gottlieb said its investigation found that the Thresholds for Regulation CC
FDIC nurtured “a patriarchal, insular and risk-averse culture” Funds Availability
that contributed to the conditions that allowed for misconduct.
It also found that widespread fear of retaliation prevented The Federal Reserve and CFPB have announced they had jointly
agency employees from speaking out, and that the response by adjusted for inflation dollar amounts relating to the availability of
the agency’s management to reports of misconduct “have been customer funds, with the adjustments taking effect July 1, 2025.
insufficient and ineffective.” The investigation, which included The changes in Regulation CC include the minimum amount of
interviews with more than 500 individuals, was commissioned by deposited funds that banks must make available for withdrawal
the FDIC following media reports of widespread misconduct at by opening of business on the next day for certain check deposits.
the agency. They also include the amount of funds deposited by certain
checks in a new account that are subject to next-day availability.
Read the report: https://www.fdic.gov/sites/default/files/2024-05/
cleary-report-to-fdic-src.pdf The agencies are required to adjust the dollar thresholds every five
years.
Read Gruenberg’s statement: https://www.fdic.gov/news/press-
releases/fdic-chairman-addresses-independent-third-party-report- The new thresholds are:
message-employees • Minimum amount: $275
• Cash withdrawal amount: $550
Court Blocks CFPB’s Late Fee Rule • New account amount: $6,725
from Taking Effect • Large-deposit threshold: $6,725
•
Repeatedly overdrawn threshold: $6,725
A federal judge in Texas issued a preliminary injunction blocking • Civil liability minimum and maximum for individual
the CFPB’s credit card late fee rule from taking effect on May 14 action: $125/$1,350
as scheduled. The ruling came in the case brought by ABA, the • Civil liability maximum for class action: $672,950
U.S. Chamber of Commerce and other plaintiffs. ABA President Read more: https://www.federalreserve.gov/newsevents/
and CEO Rob Nichols welcomed the ruling, which he said “will pressreleases/files/bcreg20240513a1.pdf
spare banks from having to immediately comply with a rule that
clearly exceeds the CFPB’s statutory authority and will lead to Federal Report Raises Concerns
more late payments, lower credit scores, increased debt, reduced
credit access and higher APRs for all consumers – including the About Nonbank Mortgage
vast majority of cardholders who pay on time each month.” Servicing
In issuing the ruling, Judge Mark Pittman found that the
plaintiffs had a substantial likelihood of success on the merits In a new report on the nonbank mortgage servicing industry, the
and that they faced a threat of irreparable harm from the CFPB’s Financial Stability Oversight Council said that a patchwork of
state laws and limited federal oversight have failed to address the

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