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Arizona Supreme Court requires CARES Act attestations in eviction proceedings
On July 7, the Arizona Supreme Court issued Administrative Order No. 2020-105 regarding the disposition of residential eviction cases during the Covid-19 public health emergency. Among other things, the order requires any complaint seeking eviction for non-payment of rent for any part of the period between March 27 and July 25, 2020 to include an attestation by the plaintiff that the property in which the tenant resides is not covered by the CARES Act.
State Issues, Covid-19, District of Columbia, Consumer Credit, Credit Report, Consumer Finance
On July 7, the Kansas Office of the State Bank Commissioner again extended its remote work guidance for mortgage companies, mortgage loan originators, supervised loan licenses, credit service organizations, money transmitters, and credit notification registrations, previously covered here. With the update, working from home is permitted through September 15.
District of Columbia amends law relating to emergency credit alerts during Covid-19
On July 7, the mayor of D.C. signed D.C. Act 23-0332, which amends the Coronavirus Support Congressional Review Emergency Amendment Act of 2020, previously covered here, and certain other laws to, among other things, add provisions relating to emergency credit alerts. Under the amendments, a user of a credit report may not consider adverse information in a consumer report that was the result of an action or inaction by the consumer that occurred during, and was the direct or indirect result of, a public health emergency declared by the mayor, if the credit report includes an emergency credit alert.
Hawaii regulator extends guidance permitting licensees to reduce office hours, temporarily close offices
On July 2, the Hawaii Division of Financial Institutions extended earlier guidance, previously covered here, that temporarily permits licensees with locations in Hawaii to reduce hours or close offices during Hawaii’s Covid-19 emergency period. Notice of temporary closure or relocation from certain licensees, including escrow depositories and financial institutions, is required. The guidance is extended to July 31, 2020.
CFPB’s semi-annual report to Congress discusses Covid-19 response
On July 7, the CFPB issued its semi-annual report to Congress covering the Bureau’s work from October 1, 2019, through March 31, 2020. The report, which is required by the Dodd-Frank Act, addresses, among other things, problems faced by consumers with regard to consumer financial products or services; significant rules and orders adopted by the Bureau; and various supervisory and enforcement actions taken by the Bureau. In her opening letter, Director Kathy Kraninger discusses the Bureau’s response to the Covid-19 pandemic, stating that the Bureau has participated in “countless joint statements, virtual co-appearances, and shared broadcasts to stakeholders with [their] prudential partners” and has “directly engage[d] consumers with the right information, at the right time.”
Among other things, the report highlights first time homebuyers and credit scores as areas in which consumers face significant problems, citing to the Bureau’s Market Snapshot on First-time Homebuyers and the quarterly consumer credit trends report on public records. In addition to highlighting the Bureau’s previous efforts during the reporting period, the report notes upcoming initiatives and plans, including (i) the Taskforce on Federal Consumer Financial Law’s public listening sessions in the fall; (ii) the cost-benefit analysis symposium in July; and (iii) further work on their Covid-19 pandemic responses.
FinCEN advisory warns of Covid-19 scams and money-mule schemes
On July 7, the Financial Crimes Enforcement Network (FinCEN) issued an advisory alerting financial institutions to potential indicators of Covid-19 imposter scams and money mule schemes (where actors impersonate federal government agencies, international organizations, and charities). The advisory outlines numerous red flag indicators and examples of these types of schemes in order to assist financial institutions in detecting, preventing, and reporting suspicious transactions. FinCEN emphasizes that “no single financial red flag indicator is necessarily indicative of illicit or suspicious activity,” and encourages financial institutions to consider additional contextual information, such as a customer’s historical financial activity and whether a customer exhibits multiple indicators, before making a determination that a transaction is suspicious or otherwise indicative of a potentially fraudulent Covid-19-related activity. FinCEN further advises financial institutions—in line with their risk-based approach to Bank Secrecy Act compliance—to perform additional inquiries and conduct investigations as necessary.
Fed releases CARES Act credit reporting, mortgage servicing examination procedures
On July 7, the Federal Reserve Board (Fed) released CA 20-11 and related examination procedures for the credit reporting and mortgage servicing provisions of the CARES Act. The procedures apply to CARES Act provisions that created new requirements for furnishers of credit information and mortgage servicers of certain mortgage loans for consumers impacted by the Covid-19 pandemic. The CARES Act amended the FCRA and required that consumer accounts be reported by furnishers as current if the consumer was current prior to the grant of a CARES Act accommodation. For mortgage servicers, the CARES Act generally required servicers of federally backed mortgage loans to grant forbearance requests toCovid-19-impacted borrowers. Servicers of these mortgages were also prohibited from initiating foreclosures through May 17, 2020. Structured as a series of modules with similar requirements grouped together, the examination procedures are intended to provide the framework for an institution’s examination, including an evaluation of the adequacy of an institution’s compliance management system. The examination procedures’ credit reporting provisions apply to supervised institutions with total consolidated assets of $10 billion or less, whereas the mortgage servicing provisions apply to all supervised institutions, including those with total consolidated assets of $10 billion or less.
The Fed advised that in exercising supervisory and enforcement responsibilities it intends to take into account the unique circumstances impacting borrowers and institutions resulting from the Covid-19 pandemic. As such, the Fed does not expect to initiate a public enforcement action against an institution provided the circumstances were related to Covid-19, and the institution demonstrated good faith efforts to support borrowers and comply with consumer protection laws.
New York Division of Licensing Services issues updates regarding exams
The New York Department of State, Division of Licensing Services, has issued updates regarding licensing exams. The division will begin offering written exams at exam sites located in regions that are in Phase 3 of reopening beginning July 6 for candidates whose previously scheduled exams were cancelled. Exam candidates must schedule their exam date prior to appearing for an exam. Walk-in exams will resume on July 13.
PPP extended until August 8
On July 4, President Trump signed S.4116, which extends authorization for the Small Business Administration’s Paycheck Protection Program (PPP) through August 8. Additionally, the measure separates the amount authorized for the SBA’s standard 7(a) small business lending program from the PPP’s authorized commitment of $659 billion.
NYDFS extends suspension of license expiration for individual insurance producers
On July 2, the New York Department of Financial Services issued a supplement that extends the relief provided by Insurance Circular Letter No. 9, previously covered here. The letter, which, among other things, suspended the expiration of licenses for individual insurance producers, has been extended for an additional 30 days through August 7, 2020. Licenses that would have expired but for the extension will automatically expire on August 7, 2020, unless the producer has submitted a license renewal application and completed all necessary continuing education credits before that date.