FinReg Currents - Week 6

Each week of the first 100 days of the new Trump administration, we will publish updates on key federal financial services regulatory and related developments.

This week, we review the following developments as of Wednesday:

• House Targets for Congressional Review Act (CRA) Nullification

• Department of Justice (DOJ): “Streamlined” CFPB to Remain

• Some Agencies Begin Terminating Probationary Employees

• Federal Deposit Insurance Corporation (FDIC) Withdrawal of Amicus Brief on State Interest Rate Importation Cap

• Securities and Exchange Commission (SEC) Cyber and Emerging Technologies Unit

House Targets for Congressional Review Act Nullification

On February 20, 2025, House Majority Leader Steve Scalise (R-La.) issued a list of priority regulatory targets for nullification under the CRA “in the coming weeks.” Included on the list is the CFPB’s December 10, 2024 final rule defining larger participants of a market for general-use digital consumer payment applications. The press release emphasizes that Majority Leader Scalise will look at additional potential CRA targets.

DOJ: “Streamlined” CFPB to Remain

The DOJ, in a February 24, 2025 filing in NTEU v. Vought, reportedly stated that CFPB Acting Director Russell Vought has “made no ‘decision to eliminate the CFPB.’” The DOJ said Vought previously told the Federal Reserve that the “Bureau’s new leadership will run a substantially more streamlined and efficient bureau” and that “[t]he predicate to running a ‘more streamlined and efficient bureau’ is that there will continue to be a CFPB.”

Additionally, according to press reports, Mark Calabria has been hired by the Office of Management and Budget and is being detailed to the CFPB to help run the agency. His title reportedly is program associate director. Calabria was previously a senior advisor with the Cato Institute and was director of the Federal Housing Finance Agency during the first Trump administration.

Some Agencies Begin Terminating Probationary Employees

Press reports indicate that the OCC on February 21 began firing probationary employees, with the total so far reportedly more than 75, including several Supervision Risk and Analysis department economists.

The CFTC also reportedly began firing probationary employees last week. The total so far is reportedly around 12, including attorneys in the Division of Enforcement and the Division of Market Oversight.

FDIC Withdrawal of Amicus Brief on State Interest Rate Importation Cap

According to press reports, the FDIC on February 24, 2025 withdrew its September 23, 2024 amicus brief in support of a 2023 Colorado law that caps the interest rates that out-of-state banks can charge for loans to Colorado consumers. Industry groups filed a complaint seeking a preliminary injunction in March 2024, which was granted by a U.S. district judge in June 2024. The state of Colorado appealed the injunction on September 16, 2024, and the case is pending in the U.S. Court of Appeals for the Tenth Circuit.

SEC Cyber and Emerging Technologies Unit

On February 20, 2025, the SEC announced the establishment of the Cyber and Emerging Technologies Unit (CETU) to address cyber-related misconduct and bad actors in the emerging technologies space. The CETU replaces the SEC Crypto Assets and Cyber Unit. It is led by Laura D’Allaird, who was with the Cyber Unit, and includes fraud specialists and attorneys from a number of SEC offices. According to the SEC press release, the CETU will address misconduct in areas including:

• Fraud committed using emerging technologies, such as artificial intelligence and machine learning;

• Use of social media, the dark web, or fake websites to commit fraud;

• Hacking to obtain material nonpublic information;

• Fraud involving blockchain technology and crypto assets;

• Regulated entity compliance with cybersecurity regulations; and

• Fraudulent cybersecurity disclosures by public issuers.

For more details on any of these developments, or to discuss how these changes may impact your business, please reach out to our team. Stay tuned for next week’s update, where we will continue to bring you the latest in federal financial services regulatory and related developments.

You may use the following links to access our prior issues:

• FinReg Currents - Week 5
• FinReg Currents – Week 4
• FinReg Currents – Week 3
• FinReg Currents – Week 2
• FinReg Currents – Week 1