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On January 13, the FTC announced that Chairwoman Edith Ramirez will be stepping down effective February 10. Chairwoman Ramirez was appointed by President Barack Obama and has served as a commissioner since April 2010. She became chairwoman in March 2013, after former FTC Chairman Jon Leibowitz resigned. Her departure means that President-elect Donald Trump will have the chance to fill three vacancies at the agency.
On December 16, President Obama signed into law H.R. 3784, the SEC Small Business Advocate Act of 2016. The legislation, which had broad bipartisan support in the House and Senate, establishes (within the SEC) an Office of the Advocate for Small Business Capital Formation and a Small Business Capital Formation Advisory Committee. Both the Office of the Advocate and the Advisory Committee will be tasked with the dual role of helping small businesses navigate the securities laws and advocate against the application of overly burdensome regulations to small businesses. The small-business advocate is modeled after the SEC’s office of the investor advocate, which was created under the Dodd-Frank Act as a voice for investors.
On December 8, Congress passed the Global Magnitsky Human Rights Accountability Act as part of the National Defense Authorization Act for 2017, which now awaits President Obama's signature. Championed by U.S. Senators Ben Cardin (D-Md.), Ranking Member of the Foreign Relations Committee, and John McCain (R-Ariz.), Chairman of the Armed Services Committee, the bill gives the President of the United States the authority to deny human rights abusers and corrupt officials entry into the United States or access to our financial institutions. The bipartisan legislation builds on the Russia-specific Sergei Magnitsky Rule of Law Accountability Act of 2013 to apply sanctions globally, and makes significant acts of corruption sanctionable offenses.
On December 1, the U.S. Senate, by a 99-0 margin, passed a 10-year extension of the Iran Sanctions Act (ISA) sending the measure to the White House and delaying any potentially tougher actions until next year. Originally approved in 1996, the extended bill passed onto the Senate in November with only one vote against it from the House. Congressional authority to enforce sanctions against Iran—which was due to expire on December 31 if not renewed—will be presented to President Barack Obama, who will decide whether to sign the bill into law in the coming days.
GOP Leaders Formally Request that Obama Administration Not Finalize Rules and Regulations in its Final Days
On November 15, GOP leaders sent a letter to “Secretaries, Administrators, Directors and Commissioners” within the Obama Administration caution[ing] [each] against finalizing pending rules or regulations in the administration’s last days.” The letter explains that by “refraining from acting with undue haste, . . . it [is] less likely that unintended consequences will harm consumers and businesses.” In addition, “such forbearance is necessary to afford the recently elected administration and Congress the opportunity to review and give direction concerning pending rulemakings.”
After nearly four years as the head of the SEC, Chair Mary Jo White announced on November 14 that she intends to leave the position at the end of the Obama Administration. During her tenure, Chair White implemented the Commission’s first-ever policy to require admissions of wrongdoing in certain cases where heightened accountability and acceptance of responsibility is appropriate. To date, the Commission has required admissions from more than 70 defendants, including 44 entities and 29 individuals. Chair White’s departure affords President-elect Donald Trump the opportunity to name Chair White’s successor, subject to the Senate’s consent.
OFAC took an additional step toward further implementation of President Obama’s new policy direction toward Cuba on October 17, with the publication of a final rule amending the Cuban Assets Control Regulations, 31 CFR Part 515 (CACR). Of those most relevant to financial institutions, OFAC updated the CACR by, among other things, amending paragraphs (c) and (f) of section 515.584, which relates to certain financial transactions involving Cuba. Section 515.584(c), as outlined in OFAC’s set of updated FAQs, “authorizes all transactions incident to the processing and payment of credit and debit card transactions for third-country nationals traveling to, from, or within Cuba.” FAQ number 49 further explains that “[a]ny person subject to U.S. jurisdiction, including U.S. financial institutions and their foreign branches, may conduct transactions authorized by [section 515.584(c)].” Section 515.584(f), as explained by FAQ 73, permits: Any banking institution …that is a person subject to U.S. jurisdiction is authorized to provide financing for exports or reexports of items, other than agricultural commodities, authorized pursuant to § 515.533, including issuing, advising, negotiating, paying, or confirming letters of credit (including letters of credit issued by a financial institution that is a national of Cuba), accepting collateral for issuing or confirming letters of credit, and processing documentary collections. OFAC’s amendments to the CACR are effective immediately.
OFAC Publishes Fact Sheet and FAQ Related to Termination of Burma Sanctions Program; Updates SDN List
On October 7, OFAC published a Fact Sheet and Frequently Asked Question (FAQ) number 481 regarding the implementation of the President’s Executive Order entitled “Termination of Emergency with Respect to the Actions and Policies of the Government of Burma.” OFAC’s fact sheet explains that all OFAC-administered restrictions and authorizations under the Burma sanctions program pertaining to banking with Burma, including 2012 and 2013 OFAC general licenses that authorized certain correspondent account activity with Burmese banks, are terminated pursuant to the Executive Order. FAQ 481 clarifies that “[p]ending OFAC enforcement matters will proceed irrespective of the termination of OFAC-administered sanctions on Burma, and OFAC will continue to review apparent violations of the [Burmese Sanctions Regulations], whether [such violations] came to the agency’s attention before or after the Burma sanctions program was terminated.” In connection with terminating the Burma-related sanctions program, OFAC made several deletions to its SDN List.
On September 14, the White House issued an Executive Order titled “Termination of Emergency with Respect to the Situation in or in Relation to Côte d’Ivoire.” The Executive Order terminates the Côte d’Ivoire-related sanctions program. Accordingly, OFAC updated its SDN List to indicate the removal of the sanctions against the country established under the United Nations Security Council’s Resolution 2284. The Executive Order is effective immediately.
On September 14, President Obama announced his intent to lift certain sanctions against Burma and to designate it as a least-developed beneficiary developing country for the purposes of the Generalized System of Preferences program, a status that would allow imported products from Burma to enjoy lower tariffs and preferential treatment. Accordingly, OFAC published new FAQ 480 to address the President’s announcement regarding the policy change with respect to Burma. The policy change will take effect when the President issues a new Executive Order and, at that time, OFAC “will formally remove the Burmese Sanctions Regulations from the Code of Federal Regulations and take other administrative actions as necessary.”
- Sherry-Maria Safchuk to discuss UDAAP at an American Bar Association webinar
- Jeffrey P. Naimon to discuss "What to expect: The new administration and regulatory changes" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Jonice Gray Tucker to discuss “The future of fair lending” at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Steven R. vonBerg to discuss "LO comp challenges" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Michelle L. Rogers to discuss "Major litigation" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Michelle L. Rogers to discuss “The False Claims Act today” at the Federal Bar Association Qui Tam Section Roundtable