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:
On December 12, the Office of the Comptroller of the Currency (OCC) announced that it has conditionally approved five national trust bank charter applications, signaling continued openness to both traditional and digitally focused trust banking models. The approvals cover two de novo national trust banks and three conversions from state trust companies to national trust banks. The OCC emphasized that these decisions followed its standard, rigorous review of each application under applicable statutory and regulatory factors and framed new entrants as beneficial to consumers, competition, and innovation in the federal banking system. If these institutions satisfy the conditions imposed, they will join roughly 60 existing national trust banks among more than 1,000 national banks, federal savings associations, and federal branches supervised by the OCC. For more information, click here.
On December 11, the White House issued an executive order (EO) titled “Ensuring a National Policy Framework for Artificial Intelligence (AI).” The EO states a federal policy to sustain and enhance U.S. AI leadership through a minimally burdensome national policy framework and to limit conflicting state requirements. It directs rapid actions by multiple federal entities to evaluate, challenge, or preempt state AI laws viewed as inconsistent with that policy and to use federal funding and standard-setting to influence state approaches. For more information, click here.
On December 11, the Commodity Futures Trading Commission (CFTC) announced that Acting Chairman Caroline Pham is withdrawing the agency’s outdated guidance on “actual delivery” of virtual currencies, citing significant evolution in crypto-asset markets and the administration’s broader effort to remove overly complex rules that burden the industry and inhibit innovation. Pham framed the move as a way to better protect Americans by supporting access to safe U.S. markets, and noted that eliminating obsolete guidance will allow the CFTC to focus on implementing recommendations from the President’s Working Group on Digital Asset Markets. The CFTC indicated it will evaluate whether updated guidance or FAQs are warranted and invited public input through the agency’s ongoing Crypto Sprint initiative. For more information, click here.
On December 11, the U.S. House passed the Incentivizing New Ventures and Economic Strength Through Capital Formation (INVEST) Act on a strong bipartisan vote of 302–123, advancing a Financial Services Committee package led by Chairman French Hill (R-AR), Capital Markets Subcommittee Chair Ann Wagner (R-MO), Representative Gregory Meeks (D-NY), and Representative Josh Gottheimer (D-NJ) that aims to cut regulatory red tape, expand access to capital for entrepreneurs and small businesses across the U.S., broaden investment options for retail investors and retirement savers, lower costs for companies seeking to go public, and strengthen U.S. capital markets. Supporters emphasized that the bill is designed to help families build wealth and retirement security, close aspects of the wealth gap, and support job creation, while also incorporating measures such as the Senior Security Act to protect seniors from financial fraud. The legislation builds on extensive committee work, including multiple markups in 2025 and a series of hearings since 2023 focused on expanding capital access beyond Silicon Valley, reforming the accredited investor definition, and improving both public and private markets for small and emerging companies. For more information, click here.
On December 11, The Depository Trust Company (DTC) requested, and the Securities and Exchange Commission’s (SEC) Division of Trading and Markets staff granted, no-action relief permitting DTC to launch a three-year pilot (Preliminary Base Version) of its DTCC Tokenization Services, under which DTC participants may elect to have their security entitlements in certain eligible securities (Russell 1000 constituents, U.S. Treasuries, and major index ETFs) recorded as “tokenized entitlements” on approved blockchains via registered wallets, with DTC debiting the securities to a centralized digital omnibus account, minting and burning corresponding tokens through its Factory system, and tracking token movements and official records via its LedgerScan system, while maintaining Cede & Co. as the registered owner, prohibiting use of tokenized positions for collateral or settlement value at DTC, limiting transfers to registered wallets of participants only, and implementing robust technology, resiliency, segregation, reversibility, and OFAC-screened wallet and protocol standards, as well as detailed systems-event notifications, quarterly reporting, and public transparency commitments, all on the understanding that the staff’s position is limited to specified Exchange Act provisions and rules, is based on the described facts, may be modified or revoked, and is automatically withdrawn three years after DTC commences operation of the pilot. For more information, click here.
On December 10, the OCC released preliminary findings from its supervisory review of “debanking” activities at the nine largest national banks. The objective of the review was to determine whether the banks debanked or discriminated against any customers or potential customers on the basis of their political or religious beliefs or lawful business activities. The review was required to be completed by the OCC and other federal banking agencies by December 5 pursuant to Executive Order 14331 (“Guaranteeing Fair Banking for All Americans”). According to the OCC, between 2020 and 2023, the nine banks made “inappropriate distinctions” among customers in the provision of financial services on the basis of their lawful business activities by maintaining public and nonpublic policies that restricted access to banking services for certain industry sectors or required escalated reviews and approvals before providing services. The agency states that, in many cases, rationales cited went beyond core financial risks to include reputational considerations (for example, “activities that, while not illegal, are contrary to [the bank’s] values” or sectors with “heightened media, activist, or political scrutiny”). The OCC states that it will continue its review to assess how these policies were applied in practice and their impacts on industries and the economy. The agency indicates that, at the conclusion of its review, it intends to hold banks accountable for any unlawful “debanking,” including referrals to the attorney general (AG) for any violations of the Equal Credit Opportunity Act based on religion, as required by Executive Order 14331. For more information, click here.
On December 10, the National Credit Union Administration (NCUA) announced its “Deregulation Project,” a new initiative launched in response to Executive Order 14192, that will comprehensively review all NCUA regulations in Title 12, Chapter VII of the Code of Federal Regulations and propose changes or removals where rules are obsolete, duplicative of statute, effectively guidance rather than requirements, or unduly burdensome. As part of the first round of changes, NCUA issued four notices of proposed rulemaking: amendments to the corporate credit union rules in 12 C.F.R. §§ 704.8 and 704.15 that would, among other things, remove the requirement that a corporate credit union’s asset-liability committee (ALCO) include a board member; amendments to 12 C.F.R. part 715 to streamline and simplify supervisory committee audit and verification requirements; and removal of the safeguarding and incident-response “guidelines” currently codified as Appendices A and B to 12 C.F.R. part 748, on the view that those materials should function as guidance rather than binding regulation. Stakeholders are encouraged to review the proposals in the Federal Register and submit comments via the Federal Rulemaking Portal. For more information, click here.
On December 10, Politico released a “Summary of Dem Priorities on Responsible Financial Innovation Act (RFIA)” outlining Senate Democrats’ counteroffer in negotiations over a bipartisan digital asset market structure bill before the Senate Banking Committee, under which Democrats agree to accept the vast majority of RFIA in exchange for a focused set of safeguards on investor protection, illicit finance, and ethics. The summary explains that Democrats support an efficient SEC review process for token classification, ongoing disclosure where entrepreneurial or managerial efforts persist, strong anti-evasion rules, reasonable limits on exempt digital asset fundraising, and robust secondary-market protections. It further emphasizes closing terrorist and illicit finance loopholes by empowering regulators to isolate bad actors and high‑risk platforms, modernize anti-money laundering (AML) statutes for digital assets, and ensure services comply with sanctions and risk‑based controls, while still protecting legitimate decentralized development. The document also calls for ethics rules to prevent public officials and their families from profiting from digital asset projects they influence, enhanced disclosure of digital asset holdings and promoter compensation, and a commitment to fully staffed, bipartisan SEC and CFTC commissions to implement durable rules. Finally, Democrats stress preserving the bipartisan intent of the GENIUS Act by preventing interest- or yield-bearing stablecoin products from undermining community banks and financial stability, while seeking ways to allow limited rewards and incentives without opening new loopholes. For more information, click here.
On December 9 and 10, the Consumer Financial Protection Bureau (CFPB) published eight “Agency Information Collection Activities: Comment Request” notices under the Paperwork Reduction Act, seeking Office of Management and Budget (OMB) approval to extend or reinstate several core information collections that support its existing regulations. On December 10, the CFPB requested extensions of OMB approvals for collections under the Home Mortgage Disclosure Act (Regulation C), Registration of Mortgage Loan Originators (Regulation G), and Truth in Savings (Regulation DD). On December 9, it requested reinstatement of lapsed OMB approvals for disclosure requirements for depository institutions lacking federal deposit insurance, the Interstate Land Sales Full Disclosure Act (Regulations J, K, and L), Privacy of Consumer Financial Information (Regulation P), Mortgage Acts and Practices – Advertising (Regulation N), and information collections related to the prohibition on including adverse information in consumer reports in cases of human trafficking. For more information, click here.
On December 9, the Board of Governors of the Federal Reserve System issued a request for information and comment on the future of the Federal Reserve Banks’ check services, seeking public input to inform potential long‑term strategies ranging from simplifying or substantially winding down those services to making significant infrastructure investments to maintain or enhance them. The notice explains that while checks now account for a small and declining share of noncash payments by volume, they still represent a meaningful share by value, particularly for business and certain consumer segments, even as fraud risks and operating costs have grown and the Fed’s check infrastructure has aged. Because the Monetary Control Act requires the Reserve Banks to recover their check service costs from fees charged to depository institutions, the Board is asking stakeholders to weigh in on how important Fed check services are today and over the next 3–10 years, which service features are critical, how alternative providers and electronic payment methods might substitute for checks, and whether users are willing to bear higher fees or invest in enhanced security to sustain check usage. Comments are due by March 9, 2026. For more information, click here.
On December 9, the OCC announced Interpretive Letter 1188, confirming that national banks may engage in “riskless principal” crypto-asset transactions as part of the business of banking. In these transactions, a bank acts as principal in a crypto trade with one customer while simultaneously entering into an offsetting trade with another customer, effectively intermediating between the parties without holding crypto-assets in inventory and operating in a manner economically equivalent to a broker acting as agent. The OCC emphasized that, as with any permissible activity, banks must conduct such crypto transactions in a safe and sound manner and in full compliance with applicable law. For more information, click here.
On December 9, the Financial Crimes Enforcement Network (FinCEN) announced a $3.5 million civil money penalty against Paxful, Inc. and Paxful USA, Inc., a peer‑to‑peer virtual currency trading platform, for willful violations of the Bank Secrecy Act (BSA) after the firm facilitated more than $500 million in suspicious activity tied to high‑risk jurisdictions such as Iran, North Korea, and Venezuela, as well as to Backpage.com. Paxful admitted it failed to register as a money services business, implement and maintain an effective anti‑money laundering (AML) program, and file required suspicious activity reports. FinCEN noted mitigating factors, including termination of prior leadership and a remediation effort to identify and report previously unreported suspicious activity, but used the case to reiterate that virtual asset and prepaid access businesses must register appropriately, adopt risk‑based AML programs, use tools such as IP and geolocation data to manage sanctions and jurisdictional exposure, and promptly remediate deficiencies, and it highlighted the availability of its whistleblower program for BSA and related national security violations. For more information, click here.
On December 8, the CFPB filed a joint status report in the U.S. District Court for the Eastern District of Kentucky stating that it will undertake efforts to issue an interim final rule for Section 1033 following the August 22 advance notice of proposed rulemaking and comment period. Similarly, five days earlier the CFPB filed a status report in the U.S. Court of Appeals for the Fifth Circuit stating that after extending the 2023 Section 1071 final rule’s compliance dates and issuing a notice of proposed rulemaking on November 13, it is now undertaking efforts to issue an interim final rule for Section 1071. These filings follow an opinion from the U.S. Department of Justice’s Office of Legal Counsel (OLC) concluding that the CFPB cannot lawfully draw funds from the Federal Reserve Board at this time. Specifically, the OLC concluded that the Federal Reserve System presently has no “combined earnings” from which the CFPB may lawfully draw funds under the Dodd‑Frank Act, and the CFPB has publicly stated it anticipates having sufficient funds to continue normal operations through at least December 31, 2025. For more information, click here.
On December 8, the CFTC announced a digital assets pilot program that will allow certain tokenized assets — initially limited to bitcoin (BTC), ether (ETH), and USD Coin (USDC) — to be used as collateral in CFTC‑regulated derivatives markets, accompanied by new guidance on tokenized collateral and the withdrawal of outdated requirements superseded by the GENIUS Act. Acting Chairman Caroline Pham framed the initiative as a major step toward integrating digital assets into U.S. markets with “clear guardrails,” including detailed staff guidance on the use of tokenized real‑world assets such as U.S. Treasuries and money market funds, covering eligibility, legal enforceability, segregation and custody, valuation, and operational risk. The Market Participants Division also issued a no‑action position for futures commission merchants that accept non‑securities digital assets, including payment stablecoins, as customer margin collateral or hold proprietary payment stablecoins as residual interest, subject to conditions that limit eligible assets to BTC, ETH, and USDC for the first three months and require weekly reporting and prompt notice of any significant issues. At the same time, the CFTC withdrew Staff Advisory No. 20‑34 on accepting virtual currencies into segregation, deeming it obsolete in light of market developments and the new statutory framework, and positioning the pilot as a way to foster “responsible innovation” under close CFTC monitoring. For more information, click here.
On December 8, Comptroller of the Currency Jonathan Gould told the Blockchain Association Policy Summit that a top OCC priority is reinvigorating de novo bank chartering, including for firms engaged in digital asset activities, to restore competition, innovation, and diversity to a banking system that has seen charter applications “completely stagnate” since the financial crisis. Gould noted the OCC has already received 14 de novo applications in 2025, including several national trust bank charters and conversions, and he pushed back on criticism that approving digital-asset–focused trust banks would depart from precedent by underscoring that national trust banks have long engaged in nonfiduciary custody and safekeeping and currently administer nearly $2 trillion in such assets. He stressed that treating digital-asset custody differently would disrupt established trust activities and “confine banks to the technologies of the past,” and emphasized that the OCC has decades of experience supervising national trust banks, including a crypto‑native trust bank. Gould said the agency will carefully and fairly evaluate each new charter application on its merits, treating incumbents and entrants evenhandedly, and argued that allowing banks to adopt new technologies is essential to maintaining a dynamic, competitive federal banking system consistent with Congress’s longstanding vision for national banks. For more information, click here.
On December 8, the CFTC’s Market Participants Division announced it is formally withdrawing Staff Advisory 20-34 on “Accepting Virtual Currencies from Customers into Segregation,” concluding that the 2020 guidance to futures commission merchants on capital, segregation, and risk management for customer virtual currency has been rendered outdated by subsequent developments. Since the advisory was issued, the CFTC has launched a tokenized collateral and stablecoins initiative for derivatives markets and Congress has enacted the GENIUS Act, creating a regulatory framework for payment stablecoins, prompting MPD to determine that the prior guidance is “no longer relevant” and therefore withdrawn effective immediately. For more information, click here.
On December 5, three nonprofit organizations filed a complaint in the Northern District of California seeking declaratory and injunctive relief to prevent what they describe as a de facto shutdown of the CFPB. Their suit targets Acting Director Russell Vought’s refusal to request funding for the CFPB from the Federal Reserve Board (Fed), arguing that Congress designed a statutory provision that provides stable, standing appropriation to support the CFPB’s mission and that the director’s recent interpretation of the statute — which is being used to support the refusal to request funding — unlawfully cuts off those funds. The plaintiffs ask the court to compel the CFPB to fulfill its statutory duty by requesting funding immediately. For more information, click here.
On December 5, the Congressional Research Service released a report titled “The Consumer Financial Protection Bureau Budget: Background, Trends, and Policy Options,” reviewing the CFPB’s unique funding structure, historical budget trends, and current policy debates. The report explains that, unlike most agencies, the CFPB is funded outside the annual appropriations process through capped quarterly transfers from the Federal Reserve, with that cap originally rising to a projected $823 million in FY2025 before being reduced by P.L. 119-21 to an estimated $446 million. It documents how CFPB transfer requests grew from $161 million in FY2011 to $729 million in FY2024, how unobligated Bureau Fund and Civil Penalty Fund balances have accumulated, and how spending growth has been driven largely by salaries and benefits. The report also describes recent developments under Acting Director Russell Vought, including reliance on unobligated balances expected to be exhausted in early 2026, an Office of Legal Counsel opinion asserting that the CFPB may not legally draw new funds from the Federal Reserve while it operates at a loss, and ongoing litigation over that position. Finally, it surveys legislative options now before the 119th Congress, ranging from leaving the current structure in place with the revised cap, to bringing the CFPB under appropriations, reducing or eliminating its funding cap, changing pay scales, or abolishing the agency altogether. For more information, click here.
On December 5, the OCC issued Bulletin 2025-44 announcing that, together with the Federal Deposit Insurance Corporation (FDIC), it is withdrawing the 2013 “Interagency Guidance on Leveraged Lending” and the 2014 “Frequently Asked Questions for Implementing March 2013 Interagency Guidance on Leveraged Lending,” and rescinding the prior communications that transmitted those documents. The agencies state that banks engaging in leveraged lending, including through participations, are expected to manage these exposures under the general principles of safe and sound lending, rather than under the specific leveraged lending framework set out in the now-withdrawn guidance. Examiners will continue to review underwriting, risk ratings, and loan loss reserves related to leveraged loans in a manner tailored to each bank’s size, complexity, and risk profile, consistent with those general safety and soundness standards. For more information, click here.
On December 5, the OCC issued Bulletin 2025-45 updating its guidance on “venture loans” to early-, expansion-, and late-stage companies, emphasizing that the OCC does not seek to discourage prudent venture lending but expects such activity to be conducted within each bank’s risk appetite and consistent with safe and sound practices. The bulletin, which rescinds Bulletin 2023-34, explains that venture lending involves heightened default risk given borrowers’ limited operating histories, uncertain cash flows, and reliance on external equity, and therefore requires strong underwriting, robust structural protections, accurate risk ratings, and appropriate reserves. It provides detailed guidance on segmenting early/expansion- and late‑stage borrowers, identifying high‑risk characteristics, designing loan structures (including covenants and collateral controls), managing portfolio concentrations, and evaluating primary and secondary repayment sources (including clear cautions against treating uncommitted future equity raises or unrestricted, declining cash balances as sustainable primary repayment sources). For more information, click here.
On December 5, the U.S. Small Business Administration (SBA) announced that it has ordered all 4,300 firms in the 8(a) Business Development Program to submit three years of detailed financial records by January 5, 2026, as part of a broad effort to root out fraud, waste, and abuse in preference-based federal contracting. Firms that fail to comply risk losing their 8(a) eligibility and may face additional investigative or remedial actions. SBA Administrator Kelly Loeffler framed the move as a response to mounting evidence that the program has been misused as a pass‑through vehicle, citing an ongoing SBA‑ordered audit following a $550 million fraud and bribery case involving two 8(a) contractors and a former federal contracting officer, recent suspensions tied to roughly $253 million in awards, and parallel review efforts such as the U.S. Treasury’s audit of approximately $9 billion in preference-based contracts. For more information, click here.
On December 4, the Federal Reserve Board announced the 2026 pricing, effective January 1, 2026, for payment services the Federal Reserve Banks provide to banks and credit unions, including check clearing, ACH transactions, instant payments, and wholesale payment and settlement services. As required by law, the Board set fees to recover actual and imputed costs over the long run and projects 108% cost recovery for 2026, including a private‑sector-equivalent return on equity. On average, prices for established, mature services will rise by an estimated 0.9%. For more information, click here.
On December 4, the FinCEN released a new Financial Trend Analysis showing that BSA data reflect more than $2.1 billion in reported ransomware payments across 4,194 incidents from 2022–2024, with activity peaking in 2023 at 1,512 incidents and $1.1 billion in payments before declining somewhat in 2024 following major law enforcement disruptions. The report, which analyzes incidents by attack date rather than filing date, highlights that the median payment per transaction rose from about $124,000 in 2022 to $175,000 in 2023 and $155,000 in 2024; that manufacturing, financial services, and health care were the most heavily impacted sectors; that threat actors most frequently used The Onion Router (TOR) to communicate; and that variants such as ALPHV/BlackCat, Akira, LockBit, Phobos, and Black Basta accounted for roughly $1.5 billion in payments. FinCEN underscored the critical role of timely suspicious activity reporting by financial institutions in tracking ransomware trends and pointed to its ransomware resources and guidance for institutions as part of broader efforts to safeguard the financial system and meet its Anti-Money Laundering Act mandate to publish threat-pattern analyses. For more information, click here.
On December 4, the CFTC announced that, for the first time, listed spot cryptocurrency products will begin trading on CFTC‑registered futures exchanges, opening what Pham called a “new Golden Age for Innovation” in U.S. digital asset markets. Pham framed the move as the long-delayed implementation of post‑financial crisis reforms that require leveraged retail commodity trading to occur on regulated futures exchanges, arguing that prior “regulation by enforcement” produced large fines without giving retail customers a safe venue to trade. The initiative, developed in coordination with the SEC and as part of the CFTC’s “Crypto Sprint,” implements recommendations from the President’s Working Group on Digital Asset Markets and is accompanied by related efforts to enable tokenized collateral (including stablecoins) in derivatives markets and to update CFTC rules on collateral, margin, clearing, settlement, reporting, and recordkeeping to support blockchain-based market infrastructure. For more information, click here.
On December 3, several Democratic senators, led by Ranking Member Elizabeth Warren (D-MA) of the Senate Banking Committee, sent a letter to Vought warning that his stated plan to “close down” the CFPB and allow its funding to lapse could severely disrupt the $13 trillion mortgage market and broader housing finance system. The letter emphasizes that the CFPB is the primary federal regulator of consumer mortgages, enforces qualified mortgage (QM) standards, and manually calculates and publishes the weekly average prime offer rates (APOR), which lenders use to determine whether loans receive QM liability protections. If APOR publication stops, the Senators argue, lenders may pull back from lending to lower‑income borrowers or raise rates to compensate for legal uncertainty. Citing an amicus brief from the Mortgage Bankers Association, National Association of Home Builders, and National Association of Realtors warning of “potentially catastrophic consequences” if CFPB rules were called into question, the letter also notes earlier confusion after Vought’s February stop‑work order and expresses skepticism about the idea that lenders could safely self‑calculate APOR. The senators stress that shuttering or severely curtailing the CFPB would destabilize not only mortgage markets but also large auto, student loan, and credit card markets, and they request specific answers by December 16 on whether APOR staff will be furloughed, whether APOR tables will cease, and what, if any, alternatives the CFPB has developed. For more information, click here.
State Activities:
On December 5, New York Governor Hochul signed S.8408 amending the state Financial Services Law to create new civil penalty authority for “prohibited unlicensed acts” in the financial services marketplace. The law authorizes the superintendent of financial services to investigate and bring adjudicatory proceedings against persons who engage in activities that require a license, registration, charter, or other authorization under the Banking Law or Financial Services Law without being properly authorized. Civil penalties for unlicensed conduct are aligned with existing penalty provisions in the Banking Law and Financial Services Law, with the potential for up to double penalties and restitution where consumer harm occurs, and the statute bars double‑penalizing the same act under overlapping provisions. The measure is intended to remove what lawmakers viewed as an illogical advantage for unlicensed actors by ensuring that those who evade licensing or authorization requirements face the same monetary consequences as licensed entities that violate the law. For more information, click here.
On December 5, Hochul signed A3307A enacting the 2022 Uniform Law Commission’s recommended amendments to the Uniform Commercial Code (UCC) to address emerging technologies by updating commercial law rules for transactions involving virtual currencies, distributed ledger technologies (including blockchain), electronic money, controllable electronic records, and other digital assets. The law modernizes key UCC definitions and concepts (such as “money,” “control,” “record,” and “electronic” transactions), adds a new Article 12 on controllable electronic records and related rights, and revises Article 9 and other Articles to clarify perfection, priority, and choice-of-law rules for security interests in digital assets and hybrid transactions that mix goods, services, and digital property. For more information, click here.
On December 3, the California Privacy Protection Agency announced that its board ordered Nevada-based marketing firm ROR Partners LLC to pay $56,600 in fines and past-due fees for operating as a data broker without registering under California’s Delete Act, after the firm allegedly used billions of data points to build and sell custom audience lists and behavioral profiles on more than 262 million Americans for targeted advertising. The decision, brought by CalPrivacy’s new Data Broker Enforcement Strike Force, emphasizes that advertising and marketing firms can be data brokers if they collect and sell Californians’ personal information and reiterates that inferences and consumer profiles are protected personal information under California law. With the next January registration deadline approaching and the state’s new Delete Request and Opt-Out Platform (DROP) slated to go live in 2026, CalPrivacy urged businesses to assess whether they engaged in data broker activity in 2025 and warned that it will continue to scrutinize unregistered data brokers as part of its broader enforcement campaign. For more information, click here.