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Illinois regulator permits credit unions to offer PPP loans to non-members
On April 10, the Illinois Department of Financial and Professional Regulation authorized state-chartered credit unions to offer current and future government assistance programs created as a result of the COVID-19 pandemic, including loans made under the Small Business Administration’s Paycheck Protection Program, to members of other Illinois state-chartered credit unions. Credit unions doing so must maintain documents demonstrating that the individual or business seeking assistance is a member of another Illinois state-chartered credit union and that the credit union at which the person is a member is unwilling or unable to provide the applicable government assistance.
Alaska calls for moratorium on foreclosures and evictions as part of a broader state bill
On April 10, Alaska enacted into law legislation that extended a moratorium on foreclosures, evictions, and repossessions, and also called for forbearance plans pertaining to specific state loans. The bill extended the governor’s March 11 executive order declaring a state of emergency and imposed temporary changes to state laws and regulations in response to the Covid-19 crisis. Legislative action was required to extend the governor’s executive order beyond 30 days.
New Jersey mandates 90-day grace period for insurance policyholders
On April 10, the New Jersey Department of Business and Insurance issued Bulletin 20-17 directing insurance premium finance companies to provide a 90-day grace period to pay insurance premiums to any clients experiencing a financial hardship due to Covid-19. In addition, the bulletin directs companies to (i) waive late payment fees, finance charges, and delinquency charges and not report late payments to credit rating agencies; (ii) allow payments not paid during the 90-day period to be paid over 12 months or the remainder of the policy term, whichever is longer; and (iii) ensure that late payments are not considered in future premium calculations.
Virginia amends real estate settlement kickback provisions
On April 6, the Virginia governor signed HB 819 to add additional sections to the state code related to real estate settlements and settlement agents. Among other things, the amendments discuss the prohibition against the “payment or receipt of settlement services kickbacks, rebates, commissions, and other payments”—whether directly or indirectly—pursuant to an agreement or understanding to refer business incident to a settlement. The amendments also allow for the imposition of penalties and liabilities if a person is found to have willfully engaged in an act or practice in violation of this chapter. Specifically, the state attorney general may recover civil penalties of not more than $5,000 per violation, as well as costs, reasonable expenses, and attorney’s fees. The amendments take effect July 1.
NYDFS strongly opposes OCC’s proposed CRA rulemaking
On April 8, NYDFS Superintendent Linda Lacewell sent a letter to OCC Comptroller Joseph Otting expressing her “strong opposition” to the OCC’s notice of proposed rulemaking (NPR) issued last December to modernize the Community Reinvestment Act (CRA). (See Buckley Special Alert discussing the NPR). Lacewell urged the OCC to revise substantially or abandon the NPR, referring to the Department’s “extensive experience with the CRA” through its oversight of state-chartered banks’ compliance with the New York Community Reinvestment Act, which, according to Lacewell “largely mirrors the current federal CRA.”
Lacewell addressed several concerns, including that the NPR’s proposed evaluation framework would “reduce CRA evaluations to a single, dollar value comparison of banks’ CRA-qualifying activities to deposits.” This single-metric CRA ratio, Lacewell, stated, would eliminate important qualitative aspects of CRA evaluations and “incentivize banks to focus on large-dollar CRA activities to the detriment of complex and innovative small-dollar projects.” Lacewell also expressed concerns with deposit data limitations, and cited the OCC’s separate request for bank-specific data (covered by InfoBytes here) as an indicator that the data to be relied upon for the CRA ratio may be questionable. Lacewell also asserted that the NPR detrimentally redefines CRA-qualifying activities that may not positively impact low- and moderate-income communities, and fails to evaluate properly assessment area changes. Furthermore, Lacewell argued that the NPR reduces the importance of bank branches in CRA evaluations, and imposes new burdens that disproportionately impact intermediate-small banks.
Lacewell expressed support for an alternative approach suggested by Federal Reserve Governor Lael Brainard in January (covered by InfoBytes here), whose proposal would include, among other things, a set of thresholds calibrated for local conditions and two tests—a retail test and a community development test—that would tailor performance metrics for banks of different sizes and business models.
District of Columbia prohibits certain debt collection activity
The District of Columbia has enacted the Covid-19 Response Supplemental Emergency Amendment Act of 2020. Under the Act, among other things, for the duration of the public health emergency and 60 days after its conclusion, debt collectors are prohibited from, among other things: (i) initiating, filing, or threatening a new collection lawsuit, garnishment, seizure, attachment, or repossession; or (ii) initiating any communication with debtors via written or electronic communication, such as text, email, or telephone, subject to certain exceptions.
Louisiana Office of Financial Institutions declares emergency for repossession and escrow agents
On April 9, Louisiana Office of Financial Institutions Commissioner John Ducrest declared a state of emergency and issued guidance for repossession agents and bond for deed escrow agents due to the Covid-19 crisis. The order: (i) granted authority to temporarily close or relocate operations, services, and products; (ii) waived the 30-day notification requirement pertaining to closures or relocations of operations, services, and products; and (iii) provided guidance for reporting operational changes and temporary relocations. The declaration expires April 30, unless otherwise extended or renewed.
Louisiana Office of Financial Institutions declares emergency for residential mortgage entities
On April 9, Louisiana Office of Financial Institutions (OFI) Commissioner John Ducrest declared a state of emergency and issued guidance for Louisiana-licensed residential mortgage brokers, lenders, and originators in response to the Covid-19 crisis. The order: (i) granted the authority to temporarily close or relocate operations, services, and products; (ii) permitted mortgage loan originators to work remotely from home, even if their home isn’t registered with OFI; (iii) waived the standard prior notification requirements pertaining to closures or relocations of operations, services, and products; and (iv) provided guidance for reporting operational changes and temporary relocations. The declaration expires April 30, unless otherwise extended or renewed.
Louisiana Office of Financial Institutions declares emergency for state-licensed lenders and brokers
On April 9, Louisiana Office of Financial Institutions Commissioner John Ducrest declared a state of emergency and issued guidance for Louisiana-licensed lenders and brokers in response to the Covid-19 crisis. The order: (i) provided guidance for temporarily closing or relocating operations, services, and products; (ii) waived the 30-day notification requirement pertaining to closures or relocations of operations, services, and products; and (iii) provided guidance for reporting operational changes and temporary relocations. The declaration expires April 30, unless otherwise extended or renewed.
Louisiana Office of Financial Institutions declares emergency for check-cashing entities
On April 9, Louisiana Office of Financial Institutions Commissioner John Ducrest declared a state of emergency and issued guidance for Louisiana-based check-cashing entities in response to the Covid-19 crisis. The order: (i) granted check cashers the authority to temporarily relocate and close operations, services, or products; (ii) waived the 30-day notification requirement pertaining to closures or relocations of services, operations, and products; and (iii) provided guidance for reporting operational changes and temporary relocations. The declaration expires April 30, unless otherwise extended or renewed.