Law and regulation

New York Gov. Andrew Cuomo, in his first State of the State address, this week recommended the creation of a Department of Financial Regulation that would merge the state's Banking Department, Insurance Department and Consumer Protection Board.

After another year in which legislators and regulators rewrote the rules of the game in the payments industry, equity markets have rendered provisional judgments on which companies face the worst handicaps.

A proposed policy by the European Commission, the European Union’s executive arm, that would hasten migration to a Single Euro Area Payments system also may ban direct debit fees in 2012.

The top banking authority in India has issued a new regulation designed to further protect cardholders from fraudulent transactions made at ATMs.

Meta Financial Group Inc.’s escalating regulatory problems could foreshadow broader scrutiny for prepaid card companies.

In its latest regulatory hit, Meta Financial Group Inc. will have to reimburse customers of a high-interest loan program marketed to prepaid cardholders.

Credit card issuers were expected to raise fees and cut rewards to compensate for lost revenue from new regulations. But some have done the opposite, eliminating fees they are still permitted to charge.

Banks in the United Arab Emirates have begun to increase credit card fees, and some are introducing charges for services that previously were free.

New York Attorney General Andrew M. Cuomo announced awards of approximately $13 million in grants will be funded by the settlements reached in a statewide student loan investigation.

To some, Elizabeth Warren's concept of a consumer protection regulator is an innovation. To others, it's an abomination. Either way, it's here to stay, and banking regulation will never be the same.

Credit cardholders in the United Kingdom will gain more control over their card accounts in the New Year because of recent changes in industry policy.

Green Dot Corp. faces little financial risk from proposed legislation that would ban certain fees on prepaid cards, according to a stock analyst.

The Federal Reserve Board’s proposed rules regarding debit card interchange and network routing so far have generated only 35 comments, but one legal expert suggests “many” letters now in development will appear closer to the Feb. 22 comment deadline.

The credit card tax the Malaysian government imposed earlier this year has caused the country’s card base to drop significantly, an official at the country’s central bank tells PaymentsSource.

Richard J. Boudreau & Associates LLC, an ACA International Members’ Attorney Program member in Salem, N.H., announced that a federal jury in Detroit returned a verdict in favor of the company and two individual employees last week. ACA International first reported the decision.

Missouri Attorney General Chris Koster announced this week that his office has reached a consent judgment with Elite Financial Services Inc., a debt settlement company that allegedly misrepresented its services.



U.S. Sen Dick Durbin, D-Ill., on Dec. 22 sent a letter to Elizabeth Warren, special advisor to the secretary of the treasurer and the person responsible for establishing the newly created Consumer Financial Protection Bureau, seeking her help to protect consumers from attempts to circumvent new payment card regulations “by pushing consumers to less-regulated products such as prepaid cards.”

The Fed’s proposed new interchange rules may bring a quick end to free checking, two analysts say.

Merchant acquirers might be breathing a sigh of relief following the Federal Reserve Board’s proposal to cap debit card interchange rates at 12 cents per transaction (see story). But though the proposed rules would not directly affect them, issuer reaction might, observers say.

With so-called debit card fees poised to take a severe hit, some payments analysts say a similar attack on credit card interchange rates is inevitable.