To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week.

Federal Activities

State Activities

Federal Activities:

On May 9, the Consumer Financial Protection Bureau (CFPB) announced the withdrawal of 67 regulatory guidance documents, including interpretive rules, policy statements, and advisory opinions that have been issued since the CFPB’s inception in 2011. The withdrawn guidance documents impact most federal consumer protection laws, including the Consumer Financial Protection Act of 2010 (CFPA), Fair Credit Reporting Act (FCRA), Fair Debt Collection Practices Act (FDCPA), Equal Credit Opportunity Act (ECOA), Truth in Lending Act (TILA), Electronic Fund Transfer Act (EFTA), and Military Lending Act (MLA). The CFPB notes that the withdrawal is not necessarily final, as further review will continue to identify which guidance documents will ultimately remain withdrawn. However, the CFPB emphasizes that the guidance withdrawn should no longer be relied upon or enforced during the period of further review. For more information, click here.

On May 9, the U.S. Department of the Treasury announced President Donald Trump’s intent to nominate Jonathan McKernan as the undersecretary of domestic finance. McKernan, who has been serving as an advisor at the Treasury Department, has played a pivotal role in Secretary Scott Bessent’s senior team while awaiting Senate confirmation to lead the CFPB. The White House confirmed that McKernan is longer in contention for leading the CFPB. For more information, click here.

On May 9, the U.S. District Court for the Eastern District of Texas granted a joint motion allowing consumer advocacy groups and individuals to intervene in the ongoing legal battle over the CFPB’s Medical Debt Rule, which bans medical debt from consumer credit reports. This intervention comes after the CFPB, under new leadership, sought to vacate the rule, reversing its previous stance. The consumer groups argue that the rule is essential for protecting millions of Americans from being unfairly penalized in credit decisions due to medical debt. The court extended the stay of the rule’s effective date and set a briefing schedule, allowing the intervenors to oppose the consent judgment and preliminary injunction requested by the original plaintiffs and the CFPB. For more information, click here.

On May 8, the Senate held a roll call vote on the motion to invoke cloture for proceeding with Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, a bill aimed at regulating payment stablecoins. The motion required a three-fifths majority to pass but was rejected with 48 votes in favor, 49 against, and three senators not voting. For more information, click here.

On May 8, the Bank for International Settlements (BIS) released “DeFiying Gravity? An Empirical Analysis of Cross-Border Bitcoin, Ether and Stablecoin Flows,” which delves into the substantial cross-border flows of major cryptoassets, highlighting speculative motives and transactional uses, particularly for stablecoins. It reveals that geographical barriers are less significant in crypto flows compared to traditional financial flows, and capital flow management measures appear ineffective. Last month, BIS published “Cryptocurrencies and Decentralised Finance: Functions and Financial Stability Implications,” which examines the financial stability risks posed by DeFi and cryptocurrencies. This paper suggests tailored regulatory interventions to manage these risks, emphasizing the need for prudential regulation to foster innovation while ensuring stability. For more information, click here and here.

On May 7, the Office of the Comptroller of the Currency (OCC) issued Interpretive Letter 1184, clarifying the authority of national banks and federal savings associations to engage in crypto-asset custody and execution services. The letter confirms that banks may buy and sell assets held in custody at the customer’s direction and outsource permissible crypto-asset activities, including custody and execution services, to third parties, provided they adhere to appropriate third-party risk management practices. This clarification builds on previous guidance from Interpretive Letters 1170 and 1183, emphasizing the need for banks to conduct these activities in a safe and sound manner, in compliance with applicable laws. For more information, click here.

On May 6, the CFPB announced a significant shift in its enforcement priorities, choosing not to prioritize actions related to Buy Now, Pay Later (BNPL) loans under the Truth in Lending (Regulation Z). The CFPB will not prioritize enforcement actions based on the regulation governing BNPL loans and is redirecting its efforts to support servicemen, veterans, and small businesses. The CFPB is also contemplating rescinding the BNPL regulation, indicating a potential regulatory rollback in this area. For more information, click here.

On May 6, the U.S. District Court for the Southern District of Florida granted the Revenue Based Finance Coalition’s unopposed motion to stay the Section 1071 Rule and hold proceedings in abeyance. This decision follows the Fifth Circuit’s stay order in Texas Bankers Association v. CFPB, with the court agreeing to toll the rule’s compliance deadlines for the plaintiff and its members. The court emphasized the importance of conserving resources while the CFPB anticipates issuing a Notice of Proposed Rulemaking, which may resolve the litigation. The parties are required to provide status reports every 60 days and notify the court within seven days of the Fifth Circuit stay being lifted to determine how to proceed. For more information, click here.

On May 5, House Committee leaders, including Financial Services Chairman French Hill (R-AR) and Agriculture Chairman G.T. Thompson (R-PA), released a discussion draft of a bill aimed at establishing a regulatory framework for digital assets in the U.S. This draft builds on previous bipartisan efforts to provide regulatory clarity and protect consumers while fostering innovation in the digital asset ecosystem. The leaders emphasized the importance of creating a commonsense regulatory regime to maintain America’s position as a leader in financial innovation. The next day, a joint hearing was held by the House Financial Services Subcommittee on Digital Assets and the House Agriculture Subcommittee on Commodity Markets to discuss “American Innovation and the Future of Digital Assets: A Blueprint for the 21st Century.” For more information, click here.

On May 5, the OCC issued Bulletin 2025-8, announcing a request for information (RFI) regarding community banks’ engagement with digitalization. This initiative seeks comments from national banks, federal savings associations, and other interested parties on the challenges and barriers faced by community banks in adopting digital banking solutions. The RFI aims to gather insights without imposing obligations or interpreting regulations, aligning with the OCC’s mission to ensure safe and sound banking operations and fair access to financial services. Stakeholders are encouraged to submit their comments within 45 days of the publication in the Federal Register. For more information, click here.

On March 3, Senator Ruben Gallego (D-AZ) and several colleagues issued a statement regarding the GENIUS Act, emphasizing the necessity for a bipartisan regulatory framework to protect consumers from predatory practices as stablecoins gain popularity. While acknowledging the constructive approach taken toward the bill, the senators highlighted unresolved issues such as anti-money laundering, foreign issuers, national security, and financial system safety that need addressing before they can support the bill’s progression. For more information, click here.

On May 2, the Internal Revenue Service (IRS) experienced a significant shift as two key directors, Seth Wilks and Raj Mukherjee, accepted deferred resignation offers facilitated by the Department of Government Efficiency. Both Wilks and Mukherjee, who transitioned from the crypto industry to the IRS, were instrumental in advancing the IRS Digital Asset Initiative, focusing on crypto taxation and compliance. Their departure follows the Trump administration’s broader initiative to offer deferred resignations to federal employees, with more than 20,000 IRS staff participating in the program. For more information, click here.

On May 1, the U.S. Court of Appeals for the Fifth Circuit dismissed the CFPB appeal concerning the vacated amendments to its Unfair, Deceptive, or Abusive Acts and Practices (UDAAP) Examination Manual. This dismissal, following a joint stipulation by the parties, aligns with the CFPB’s newly announced supervision and enforcement priorities for 2025. The CFPB plans to concentrate its efforts on depository institutions, restoring its focus to the levels seen in 2012, and will prioritize enforcement actions involving proven intentional discrimination rather than relying solely on statistical evidence. For more information, click here.

On May 1, the Federal Trade Commission (FTC) announced that it had entered into a stipulated permanent injunction and money order, prohibiting Global Circulation, Inc. (GCI) and its owner, Kenneth Redon III from any further debt collection activities. Last year, the FTC filed suit in the U.S. District Court for the Northern District of Georgia, alleging GCI and its owner violated the FTC Act, Fair Debt Collection Practices Act and its associated Regulation F, § 521 of the Gramm-Leach-Bliley Act, and the FTC’s Trade Regulation Rule on Impersonation of Government and Businesses. Specifically, regulators alleged that the defendants, under their own name and several others, would contact consumers about debts they did not owe or GCI did not have authority to collect. The FTC obtained a temporary restraining order in November 2024 and a receivership was put into place. A judgment of $9,684,338 will be entered in favor of the FTC, which will be suspended provided all financial holdings of both defendants from multiple banks and businesses are transferred to the receivership and certain transfers from Redon are made. However, the full judgment will become due if either defendant is found to have lied about their finances. For more information, click here.

On May 1, Congressman Lance Gooden (R-TX) addressed a letter to Acting Administrator Stephen Ehikian of the General Services Administration (GSA), advocating for the installation of cryptocurrency ATMs in federal buildings across the U.S. Gooden emphasized the importance of reflecting the rapid evolution of financial technology in public spaces, highlighting the benefits of enhanced accessibility and educational opportunities for citizens, particularly in underserved areas. He urged the GSA to explore the feasibility of this initiative, ensuring compliance with security and consumer protection standards, and aligning with Trump’s vision of positioning the U.S. as a leader in cryptocurrency and blockchain technology. For more information, click here.

On April 30, the Senate Committee on Commerce, Science, and Transportation held a meeting to discuss S.1492, the Deploying American Blockchains Act of 2025, sponsored by Senator Bernie Moreno (R-OH). The committee ordered the bill to be reported favorably without amendment, marking a significant step in its legislative journey. This bill aims to enhance the U.S.’s leadership in blockchain technology by mandating the secretary of commerce to support its deployment, use, application, and competitiveness. For more information, click here.

On April 30, Hill appeared on the Crypto in America podcast to discuss recent developments in market structure legislation and the House Financial Services Committee’s payment stablecoin bill. Hill emphasized the transformative potential of blockchain and distributed ledger technology in revolutionizing financial services and peer-to-peer transactions, predicting broader applications beyond traditional finance. He highlighted the appeal of decentralized finance due to its lower costs and inclusivity. He also noted ongoing discussions with Chairman Tim Scott to advance both the payment stablecoin and digital asset market structure bills through Congress to the president’s desk. For more information, click here.

State Activities:

On May 9, the Superior Court of New Jersey, Appellate Division, delivered a decision in the case of Anchor Law Firm, PLLC, and Andrew M. Carroll, Esq. v. The State of New Jersey, et al., challenging the constitutionality of the “limited attorney exemption” under the Debt Adjustment and Credit Counseling Act (DACCA). The plaintiffs, who represent debtors in bankruptcy and collection cases, argued that the exemption, which restricts attorneys “principally engaged” as debt adjusters, violates the New Jersey Constitution’s separation of powers and is void for vagueness. The court agreed, finding that the exemption encroaches upon the Judiciary’s exclusive authority over the practice of law and lacks sufficient clarity, thus invalidating the provision. The case has been remanded for further proceedings regarding related civil rights claims. For more information, click here.

On May 6, Indiana Governor Mike Braun signed House Bill 1125 into law, marking the establishment of the Indiana Earned Wage Access Act. This legislation introduces a new chapter in the Indiana Code to regulate earned wage access services. The act, administered by the division of consumer credit within the Department of Financial Institutions, outlines provisions for licensing providers, supervisory authority, reporting requirements, and prohibited acts, among others. It also allows lenders to contract for a nonrefundable prepaid finance charge of 3% on certain loans secured by land, an increase from the previous 2%. For more information, click here.

On May 6, New Hampshire Governor Kelly Ayotte signed HB 302 into law, making New Hampshire the first state to establish a “Strategic Bitcoin Reserve.” This groundbreaking legislation authorizes the state treasury to invest in Bitcoin and other digital assets, provided they have a market cap exceeding $500 billion, a threshold currently met only by Bitcoin. The law limits these holdings to 5% of the state’s total funds, ensuring they complement the broader investment strategy. It mandates that any Bitcoin or digital assets in the reserve be held in U.S.-regulated custody, promoting security, fiscal responsibility, and transparency. For more information, click here.

On May 5, Washington Attorney General (AG) Nick Brown, along with AGs from several other states and the California Department of Financial Protection and Innovation, sent a letter to Acting Director Russell Vought of the CFPB, urging the prioritization of distributing $4.2 million in consumer refunds related to the Prehired LLC case. This action follows a Stipulated Judgment requiring Prehired to cease operations and refund consumers after allegations of deceptive practices. Despite securing funds from the CFPB’s Civil Penalty Fund nearly a year ago, the refunds have yet to be issued, prompting the AGs to request a timeline for distribution to affected consumers nationwide. For more information, click here.

On May 2, Virginia Governor Glenn Youngkin signed Senate Bill 1212 (SB 1212) into law, introducing new requirements and prohibitions under the Virginia Consumer Protection Act. Specifically, SB 1212 targets the disclosure of mandatory fees and surcharges in consumer transactions. Specifically, suppliers must clearly and conspicuously display the total price of goods or services, including all mandatory fees or surcharges, in any advertisement or display. Certain industries are exempt from these disclosure requirements, including motor vehicle dealers; electric utilities, natural gas utilities, and telecommunications service providers; real estate settlement services (excluding real estate broker commissions and fees); air transportation by air carriers; and health club services. For more information, click here.

On May 2, Virginia Governor Glenn Youngkin approved House Bill No. 1725, establishing the Medical Debt Protection Act, which amends and reenacts § 59.1-200 of the Code of Virginia and introduces Chapter 58, consisting of §§ 59.1-607, 59.1-608, and 59.1-609. This legislation aims to protect consumers from unfair medical debt collection practices by prohibiting certain extraordinary collection actions, such as arrest or foreclosure, and limiting interest rates on medical debt to three percent per annum. The act mandates that large health care facilities and medical debt collectors adhere to specific billing and collection rules, including providing clear notices to patients before initiating collection actions. Violations of this act will be treated as prohibited practices under the Virginia Consumer Protection Act, with enforcement provisions applicable. The act is set to become effective on July 1, 2026. For more information, click here.

On May 2, a coalition of AGs from 18 states and the District of Columbia submitted a letter to the U.S. Department of Housing and Urban Development (HUD) expressing strong opposition to the Interim Final Rule (IFR) on Affirmatively Furthering Fair Housing (AFFH). The IFR, which repeals the 2021 Interim Final Rule and sections of the 2015 AFFH Rule, is criticized for weakening HUD’s ability to fulfill its duty under the Fair Housing Act to promote fair housing and address segregation. The AGs argue that the IFR’s revised definitions and lack of specific planning processes undermine efforts to combat segregation and fail to provide a reasoned justification for these changes, urging HUD to withdraw the IFR entirely. For more information, click here.

On May 1, Montana Governor Greg Gianforte signed House Bill 114 into law, a comprehensive act revising consumer protection laws, specifically targeting unfair and deceptive practices in financial planning and insurance sectors. The legislation prohibits insurance producers from misrepresenting themselves as financial planners unless they hold recognized certifications, mandates clear disclosures about commissions, and requires written agreements for financial planning fees. It also addresses unfair claim settlement practices, false advertising, and restrictions on lenders regarding insurance solicitation. The act amends several sections of the Montana Code Annotated, including §§ 33-18-201, 33-18-202, 33-18-203, 33-18-501, and 33-18-1001, with a delayed effective date of January 1, 2026. For more information, click here.

On April 28, Tennessee Governor Bill Lee signed House Bill 908 into law, amending the Tennessee Code Annotated, Title 45 and Title 47, concerning interest rates on home loans. The legislation establishes that the maximum effective annual interest rate for home loans will be set at four percentage points above the average prime offer rate for a 30-year fixed loan, as defined by federal regulations and published by the Federal Financial Institutions Examination Council. However, the interest rate cannot exceed 18% per annum. This act is slated to take effect on July 1. For more information, click here.

On April 11, North Dakota Governor Kelly Armstrong signed House Bill 1127 into law, effectively codifying the Gramm-Leach-Bliley Act (GLBA) Safeguards Rule into state legislation, including recent amendments concerning data breach notifications. Set to take effect on August 1, the law applies to “financial corporations” regulated by the state’s Department of Financial Institutions, excluding traditional banks and credit unions. This encompasses entities such as collection agencies, debt settlement service providers, and mortgage loan servicers. The law mandates notification to the commissioner for breaches affecting at least 500 consumers, complementing existing state data breach notification requirements. For more information, click here.