How a lawsuit pitting PayPal against the CFPB could impact how tightly the agency can regulate digital payments, and more
American Banker
In-depth analysis, perspective and commentary on key issues affecting the banking industry.
How similar is a digital wallet to a prepaid card? The distinction lies at the heart of an important regulatory tussle between PayPal and the Consumer Financial Protection Bureau. For the millions of Americans who use mobile and web-based payment services like PayPal’s Venmo, the outcome of the lawsuit could have major consequences for the consumer protections they enjoy. Also today at American Banker, Okta traces a data leak to an outside provider, illustrating the cyber-dangers of outsourcing, and home appraisers are in regulators’ crosshairs.?
A legal fight between PayPal Holdings and the Consumer Financial Protection Bureau over digital wallets could upend the bureau’s authority to mandate consumer protection disclosures across the financial services industry.
The incident is a cautionary tale about the security dangers of working with third parties, the reputational damage that can come from hackers’ leaks, and the need to disclose details of a security breach and respond to comments about it as quickly as possible.
The agencies will also scrutinize mortgage lenders to identify patterns of bias, work with other government agencies to enforce new rules and create a shared database of historical appraisals to benefit research and enforcement efforts. They will also take steps to improve the reevaluation process for buyers who feel their properties have been unfairly discounted and design guidance for computer-generated valuations.
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“I have been heartened by how many companies in the financial services industry and in corporate America have taken actions above and beyond those explicitly called for by U.S. sanctions,” wrote Rep. Maxine Waters, the chair of the House Financial Services Committee. But “the committee currently lacks a clear picture of the extent of these divestments.”
Two months after forming a consortium of large, international banks to address the risks associated with climate change, the Risk Management Association has established a similar group for midsize banks.
A new community investment plan from Truist would offer a way for community groups to benefit years after the BB&T-SunTrust merger was completed. It could also signal to other big banks that have struck similar plans in connection with large mergers that they may be expected to provide further commitments.
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