Law and regulation

WASHINGTON — Financial authorities from the Group of Seven countries on Tuesday released cybersecurity recommendations for private and public entities operating in the financial sector.

Navy Federal Credit Union, the largest credit union in the country, agreed Tuesday to pay $28.5 million to settle regulatory allegations it engaged in illegal debt collection practices.

Fintech circles are abuzz about the possibilities for streamlining compliance work following IBM's deal to buy Promontory. Artificial intelligence software could help separate false positives from true violations, for example, or read and parse through lengthy regulations.

The new prepaid rules make it harder for bad actors to enter the industry while also being broad enough to apply to future digital products.

The single-director structure of the Consumer Financial Protection Bureau represents an unconstitutional concentration of executive power, a federal appeals court said Tuesday. But the court stopped short of disbanding the agency, instead giving the president more power to remove its leader.

WASHINGTON — Federal Reserve Board Vice Chairman Stanley Fischer said Friday that the Dodd-Frank Act has addressed the biggest issues with bank instability but the "shadow banking" sector industry still needs to be addressed.

The regulations added in the wake of the financial crisis have made the system safer, but it's time to pause on new rules and find ways to improve what's been put in place already, according to the top executives at some of the largest banks.

Federal Reserve Gov. Lael Brainard said in a speech Friday that distributed ledger technology — known as "blockchain" — has great potential for the payment system and important markets, but most of those applications are still years away from maturity.

WASHINGTON — The Basel Committee will move forward with its final regulatory capital rules by yearend despite threats from the European Union that its members may choose to ignore the standards out of fear that they might stifle growth.

Treasury Secretary Jacob Lew on Friday sought to reassure banks they would not be penalized for the unforeseeable consequences of their presence in certain foreign areas, a fear that has driven a trend called de-risking.

The Consumer Financial Protection Bureau’s new regulation governing prepaid cards will disrupt consumer practices, drive up costs and wreak havoc on a fast-growing sector within the payments industry.

Current proposals about what to do with Fannie Mae and Freddie Mac that still focus on a government-backed solution are misdirected.

American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of AmericanBanker.com articles and our social media platforms.

A former top regulator of Fannie Mae and Freddie Mac wants to abandon the development of the common securitization platform and use the existing Ginnie Mae platform to issue government-guaranteed mortgage-backed securities.

WASHINGTON — A bipartisan group of House lawmakers on the financial services panel introduced legislation Wednesday that would help banks remotely open accounts.

As the financial world comes to grips with the news that the European Union has no intention of implementing the final elements of Basel III, observers are scrambling to figure out how much impact the split could have on U.S. banks and global financial stability.

If Wells Fargo employees were fired for trying to stop the bank’s improper account practices, as has been claimed in court, it shines a spotlight on the need for more whistleblower assistance.

Fourteen senators including Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., sent a letter Wednesday to Attorney General Loretta Lynch calling for the Justice Department to investigate possible criminal wrongdoing by senior executives at Wells Fargo.

Community bankers say that reclassifying "reciprocal deposits" as a less risky type of deposit will help them to compete with large banks. Some deposit brokers are crying foul, arguing that the proposed legislation would put them at a competitive disadvantage. Observers, meanwhile, say the bill is so narrowly written that it would hardly affect competition.

The agency said Wednesday it has received more than 500,000 comments on the proposal — and many more may be filed in the coming days.