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Minnesota issues executive order allowing shareholders flexibility to hold remote meetings
On April 24, the Minnesota governor issued an executive order permitting Minnesota businesses and shareholders of corporations subject to the reporting requirements of sections 13(a) and 15(d) of the Securities Exchange Act of 1934 to conduct remote shareholder meetings, provided that certain requirements are met. Additionally, if it is impracticable for a corporation to convene a currently noticed meeting of shareholders at a physical location due to Covid-19, the corporation may adjourn the meeting to another date or time, to be held by remote communication, provided certain requirements are met.
District of Columbia Department of Insurance, Securities and Banking issues bulletin regarding submission of filings
On April 24, the District of Columbia Department of Insurance, Securities and Banking issued a Bulletin 0X-SB-00X 03/20 suspending the procedures established by Bulletin 03-SB-04-03/21 in light of the Covid-19 public health emergency. Required filings and fee payments that would have been submitted pursuant to the procedures outlined in Bulletin 03-SB-04-03/21 must now be submitted to the department via PDF to a specified email address. Further, instead of physical checks, the associated payments must be submitted in electronic form in accordance with the instructions in the bulletin.
Multi-jurisdiction settlement reached with credit reporting agency over 2017 data breach
On April 17, the Massachusetts attorney general announced a settlement with a credit reporting agency (CRA) to resolve a state investigation into a 2017 data breach that reportedly compromised the personal information of nearly three million Massachusetts residents. According to the AG’s 2017 complaint (covered by InfoBytes here), the CRA ignored cybersecurity vulnerabilities for months before the breach occurred and failed to take measures to implement and maintain reasonable safeguards. Under the terms of the proposed settlement, pending final court approval, the CRA will pay Massachusetts $18.2 million and is required to take significant measures to strengthen its security practices to ensure compliance with Massachusetts law. These measures include (i) implementing a comprehensive information security program; (ii) minimizing the collection of sensitive personal information; (iii) managing and implementing specific technical safeguards and controls; (iv) providing consumer-related relief, such as credit monitoring services and security freezes; and (iv) allowing third-party assessments of its data safeguards.
Earlier, on April 14, the Indiana attorney general also announced that the CRA will pay the state $19.5 million to resolve allegations that it failed to protect Indiana residents whose personal information was exposed in the 2017 data breach. Under the terms of the final judgment and consent decree, in addition to paying $19.5 million in restitution, the CRA must take measures similar to those outlined in the Massachusetts settlement.
Massachusetts and Indiana were the only two states that chose not to participate in the 2017 multi-agency settlement that resolved federal and state investigations into the data breach and required the company to pay up to $700 million (covered by InfoBytes here).
Separately, on April 7, the City of Chicago announced a $1.5 million settlement to resolve allegations that the CRA’s failure to employ adequate data-security measures led to the breach.
Massachusetts passes legislation providing for virtual notarization
On April 23, the Massachusetts legislature passed, and the governor signed, S. 2645, which authorizes virtual notarization. Specifically, S. 2645 allows a notary public to perform a notarial act utilizing electronic video conferencing in real time, and meets standards specified in the act for electronic notarizations.
Illinois issues executive order regarding evictions
On April 23, the Illinois governor issued an executive order prohibiting residential evictions, with certain limited exceptions. Law enforcement officers in Illinois are also instructed to cease enforcement of orders of eviction for certain non-residential premises. The executive order does not relieve an individual or entity of an obligation to pay rent or comply with any other obligation in the lease or rental agreement. The executive order will remain in effect for the duration of the gubernatorial disaster proclamations.
Oklahoma Department of Consumer Credit issues amended interim guidance regarding remote work for employees of licensees
On April 23, the Oklahoma Department of Consumer Credit issued amended interim guidance to licensees regarding temporary operations from home and alternate locations. Mortgage loan originators and employees of other regulated entities who are typically required to work only from licensed locations may work from home, and sets forth data security requirements that must be met to conduct activities from home. Companies may also use an alternate site for conducting business if a licensed location is compromised or undergoing decontamination procedures. In such an event, the department is prepared to expedite address changes and waive associated fees. The department also states that it will work with affected licensees to schedule examinations or inspections to minimize disruption. The interim guidance is effective through May 31, 2020, unless otherwise changed, extended, or withdrawn.
District of Columbia Department of Insurance, Securities and Banking issues bulletin to certain insurance companies
On April 23, the District of Columbia Department of Insurance, Securities and Banking issued a bulletin to insurers, captives, and risk retention groups regarding modified regulatory filing requirements during the public health emergency. While companies are still required to make all required electronic filings with the NAIC based on modified filing deadlines, if applicable, the department will allow insurers an additional 30 to 60 days, depending on the filing, to complete filings upon a request to the department on or before the normal deadline. The bulletin sets forth the filings eligible for 30- or 60-day extensions. The bulletin also provides guidance regarding electronic filings and signatures. Further, while the department will not conduct any on-site examination work during the stay-at-home order, the department may still request certain electronic records to track trends arising from the Covid-19 pandemic.
North Carolina extends stay at home order
On April 23, North Carolina Governor Roy Cooper issued an executive order extending his prior stay at home order (previously discussed here) until May 8. Neither order specifically addresses financial institutions.
New Jersey regulator extends license application deadlines
On April 23, the New Jersey Department of Banking and Insurance extended the deadline for license and registration applications under New Jersey’s Mortgage Servicers Licensing Act to June 12, 2020. Persons required to seek licensure under the act include entities that are in the business of servicing residential mortgage loans, and which are not already licensed as residential mortgage lenders and entities licensed as residential mortgage lenders or correspondent residential mortgage lenders conducting business in New Jersey.
California executive order exempts Covid-19 assistance payments from garnishment
On April 23, Governor Newsom issued an executive order which provides that, with certain exceptions, CARES Act financial assistance payments and any other federal, state or local government assistance provided to individuals in response to the Covid-19 outbreak are exempt from garnishment, attachment, levy, or execution. The exemption extends to assistance funds placed into any account. The executive order also prohibits financial institutions from executing any lien or exercising any right of setoff against these funds.