July 1, 2020
California’s “mini-CFPB” in flux

Earlier this year, California Governor Gavin Newsom proposed the creation of the Department of Financial Protection and Innovation (DFPI) with the authority to “protect consumers from predatory businesses, without imposing undue burdens on honest and fair operators” The Governor’s Budget Summary notes that the agency would “cement California’s consumer protection leadership amidst a consumer-protection retreat by federal agencies, including the Consumer Financial Protection Bureau.”

However, due to the need for COVID-19 relief funding, budget negotiators tabled the program, leaving DFPI in limbo. Lawmakers have until Aug. 31 to finalize the 2020-21 state budget and the proposal may be revived prior to that deadline.
Connecticut voluntary mortgage relief program extended

At the onset of the COVID-19 pandemic, Connecticut credit unions and banks voluntarily began participating with the Connecticut Department of Banking to extend assistance to residents facing financial hardship caused by the pandemic. Recently, the participating credit unions and banks committed to continue their participation in the mortgage relief program through July 30, 2020. 

The provisions of the program include:
  • A 90-day grace period for all mortgage payments
  • Relief from fees and charges
  • No new foreclosures for 60 days (through July 30, 2020)
  •  No credit score changes for accessing relief
New adult financial exploitation reporting requirements in Virginia

Recently, adult financial exploitation legislation was enacted in Virginia. The measure, SB 391 , requires credit unions and other financial institutions to report to the local department of social services or the adult protective services hotline within five business days of any refusal to perform a transaction or to disburse funds based on a good faith belief that such transaction or disbursement may involve financial exploitation of an adult.

According to the Virginia Credit Union League, prior to this new law, there was no requirement to report when a financial institution had taken action of refusing or delaying a transaction or refusing to disburse funds when financial exploitation was suspected.

The legislation is effective July 1, 2020.
Washington Division of Credit Unions releases updated 2020 Examination Focus

Earlier this month, the Washington Division of Credit Unions issued a bulletin , No. B-20-02 , updating the key areas of examination focus for 2020 considering the COVID-19 pandemic. The Division initially released the examination focus for 2020 in January, but because of the pandemic, the agency is providing more information regarding the specific items examiners will review and emphasizing the importance of making adjustments to the allowance for loan and lease losses funding analysis during an economic downturn.

The Division’s 2020 examination focus areas are cybersecurity, consumer protection law compliance, liquidity, and business continuity/disaster recovery testing.

StateFocus will be published on a monthly basis during the final week of each month. Please submit any activity in your state to Shelton Roulhac for publication.
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StateFocus | www.nascus.org
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