In this issue...
The SEC announced its Share Class Selection Disclosure Initiative under which the agency’s Division of Enforcement will not recommend financial penalties against investment advisers who self-report failures to disclose conflicts of interest in mutual fund selection (i.e., receipt of 12b-1 fees) and return money to harmed clients. Advisers must notify the SEC of their intention to self-report no later than June 12, 2018.
The CFPB released its five-year Strategic Plan, which outlines the strategic goals of ensuring consumer access to consumer financial products and services, implementing and enforcing the law consistently, and making operations more efficient and effective; the plan reiterated the Bureau's commitment to fulfill its statutory duties.
The Federal Reserve Bank of New York reported that total household debt increased for the fifth consecutive year, rising by 1.5 percent to $13.15 trillion in the fourth quarter of 2017; mortgage, student, auto, and credit card debt all increased.
The IOSCO issued a consultative Report on Retail OTC Leveraged Products, which proposes policy measures for addressing the risks from the offer and sale of over-the-counter (OTC) leveraged products to retail clients, including rolling-spot forex contracts, contracts for differences, and binary options.
During his confirmation hearing, FTC chair nominee Joseph Simons signaled his intent to make data breaches a top supervisory priority for the agency.
Five witnesses testifying before the House Subcommittee on Financial Institutions and Consumer Credit favored the idea of establishing a national standard for data security and breach notification across financial services. One witness also suggested Congress establish an independent data protection agency.
A D.C. Federal appeals court ruled that collateralized loan obligations are not subject to the risk retention rules mandated by the Dodd-Frank Act. The case was originally brought against the Federal Reserve and the SEC in 2014.
The House of Representatives passed:
The CFPB released the fourth in a series of Requests for Information, this time seeking comment on its Supervision Program, including various aspects of supervisory examinations, information and document collection, communications such as the PARR letter, and MRAs.
FINRA filed a proposed rule change with the SEC to amend the Code of Arbitration Procedure for Customer Disputes and the Code of Arbitration Procedure for Industry Disputes to provide an additional hearing option for parties with claims of $50,000 or less.
The FDIC adopted a final rule to remove references to external credit ratings and replace them with appropriate standards of creditworthiness as required by the Dodd-Frank Act.
Demonstrating the growing importance of cybersecurity, the CFTC issued its first order against a firm for failing to protect customer records and information.