Financial

U.S. Banking Agencies Propose Custody Bank Relief under the Supplementary Leverage Ratio

By Luigi L. De Ghenghi, Gabriel D. Rosenberg, Andrew Rohrkemper & Greg Swanson on April 23, 2019

The U.S. banking agencies have proposed allowing custodial banking organizations to exclude certain central bank deposits from the calculation of total leverage exposure, the denominator of the U.S. Basel III supplementary leverage ratio (SLR). The proposal implements Section 402 of the Economic Growth, Regulatory Relief and Consumer Protection Act of 2018 (EGRRCPA). The three U.S. banking organizations that would benefit from this proposal are BNY Mellon, Northern Trust and State Street. Scope of Relief The…

The Capital Commitment

Rent the Runway Walks into the Litigation Spotlight

By Hena M. Vora & Michael R. Hackett on April 23, 2019

There’s a new unicorn in town, and this time, it isn’t just another tech company. Rent the Runway, also known as RTR, is now officially valued at over $1 billion after its most recent funding round which raised $125 million. The high-end rental clothing brand was launched in 2009 by female founders, including co-founder and CEO Jennifer Hyman. Rent the Runway’s third and largest round of funding took place during Hyman’s ninth month…

The D&O Diary

EEOC Charges Overall Down, But Sexual Harassment Charges Increased

By Kevin LaCroix on April 22, 2019

The number of workplace discrimination charges filed with the U.S. Equal Employment Opportunity Commission during Fiscal Year 2018 (which ended September 30, 2018) declined to the lowest level since FY 2006, according the EEOC’s recent statistical release. But while the number of charges overall are down, the number of sexual harassment charges increased, as did the number of sexual harassment lawsuits the agency filed. The increase in sexual harassment actions seems to suggest a greater…

Cov Financial Services

CFPB Director Kraninger Outlines Approach in First Major Speech

By Uttara Dukkipati on April 22, 2019

On April 17, 2019, CFPB Director Kathleen Kraninger outlined her approach in executing the Bureau’s statutory mission in a speech to the Bipartisan Policy Center. This was Director Kraninger’s first major speech since taking the helm at the Bureau. Kraninger’s remarks were organized around the tools that the Bureau will utilize to advance its core mission of preventing consumer harm. The speech was consistent with the Director’s recent testimony to House and Senate Committees but…

The BD/IA Regulator

New SEC Privacy and Cybersecurity Risk Alert Tells Broker Dealers and Investment Advisers Common Deficiencies to Avoid

By Kristen Mathews & Kelley Howes on April 22, 2019

The SEC’s new Risk Alert provides valuable insight as to what the OCIE wants to see broker dealers and investment advisers accomplish with their privacy notices and their cybersecurity policies and procedures. The SEC wants this written documentation to be comprehensive, to accurately reflect the registrant’s practices, and to be implemented effectively throughout their business. Broker dealers and investment advisers can, and should, use this Risk Alert to benchmark their own specific practices against the…

Virtual Currency Report

Dear Enterprise, Have You Developed a Sound and Methodical Blockchain Consortia Engagement Strategy?

By J. Dax Hansen, Fred Fedynyshyn, Marcelo Malpern, Youssef Sneifer & Lorri Anne Dunsmore on April 22, 2019

We can help. Perkins Coie has identified 34 factors in 5 overarching categories that shape the outcomes of successful enterprise consortia engagement efforts through its analysis of 71 consortia across 12 industries. Recently, Forbes published an article detailing the ways that large companies, including some of the best-known companies in tech, finance, manufacturing and retail, are forming or joining blockchain consortia or other proprietary blockchain projects. The Forbes article reflects an uptick in enterprise engagement…

Consumer Finance Monitor

FDIC and Duke University announce fintech research conference

By Brian Slagle on April 22, 2019

This Wednesday April 24th, the Federal Deposit Insurance Corporation and Duke University’s Fuqua School of Business and Innovation and Entrepreneurship Initiative will host a conference titled “Fintech and the Future of Banking” in Arlington, Virginia. The FDIC describes the catalyst for the event as the belief that “at the intersection of research and experience lies good public policy.” The conference features a brief introduction with Treasury Secretary Steven Mnuchin and FDIC Chairman Jelena…

Consumer Finance Monitor

New HUD Requirements for Down Payment Assistance Provided by Government Entities

By Richard J. Andreano, Jr. on April 22, 2019

On April 18, 2019 the U.S. Department of Housing and Urban Development (HUD) issued Mortgagee Letter 2019-06 setting forth new documentation requirements for down payment assistance provided by government entities to be used in connection with Federal Housing Administration (FHA) insured mortgage loans. Significantly, the new requirements are effective for case numbers assigned on or after April 18, 2019. The new requirements apply when funds from a government entity will be used to pay a…

Global FinTech & Payments Blog

US Digital Asset Bills: Will April Legislation Bring May Flowers?

By Latham & Watkins LLP on April 22, 2019

Federal legislators introduce two bills in an attempt to provide the blockchain economy with regulatory certainty. By Stephen P. Wink, Morgan E. Brubaker, Cameron R. Kates, and Shaun Musuka US regulators and federal legislators may be heeding the calls of crypto-enthusiasts for legal clarity regarding the status of digital assets and cryptocurrencies (collectively, Tokens). Two weeks ago, the Securities and Exchange Commission (SEC) released an analytical framework for determining when a Token…

The D&O Diary

D&O Insurance: Warranty Exclusion Precludes Coverage Due to Application Misrepresentation

By Kevin LaCroix on April 21, 2019

A federal district court has held that because of an insured company’s application misrepresentation about possible M&A activity, a D&O insurance policy’s Warranty Exclusion precludes coverage for the policyholder’s costs incurred in defending claims arising out of the insured company’s acquisition. The court’s opinion raises interesting questions about how the meaning of application questions is to be determined. Central District of California Judge Phillip Gutierrez’s February 4, 2019 opinion in the case can be found…