IBA E-News 2-3-17
STATE GOVERNMENT RELATIONS NEWS
It’s Not Too Late to Register for the IBA Legislative Briefing and Reception
The 2017 IBA Legislative Briefing and Reception is Tuesday, Feb. 7, and it is not too late to register! Please register today, and if you have not done so already, we encourage you to contact your legislators and invite them to attend the reception, and consider organizing a dinner following the reception to further build your relationships and become a stronger advocate for the banking industry. For questions, please contact Josh Myers, 317-917-8047.
FLD Day at the Statehouse
Register now and plan to attend the third annual Future Leadership Division Day at the Statehouse, set for March 7 in Indianapolis. The tentative agenda will include an introduction to lobbying, a review of the current issues facing the industry and lunch with a special guest speaker. After lunch, participants will walk to the Indiana Statehouse to see the legislative process in action. The remaining time will be spent observing floor sessions of the Indiana House and Senate, where attendees will have the opportunity to visit with their elected officials. For questions, please contact Josh Myers, 317-917-8047.
SB 227 – Foreclosure Counseling and Education Fee
Sen. James Merritt, R-Indianapolis
Bill summary: The bill removes a provision providing for the July 1, 2017, expiration of the $50 mortgage foreclosure counseling and education fee that must be paid by a party filing an action to foreclose a mortgage.
What happens next: The bill was heard in the Senate Public Policy Committee on Feb. 1. The bill was held, as no action was taken on the bill at the hearing.
SB 539 – Notaries Public and Trademarks
Sen. Rodric Bray, R-Martinsville
Bill summary: The bill permits electronic and remote notarizations. This bill also describes how electronic notarizations must be secured. It requires the maintenance of an electronic journal to document all performed electronic notarizations. The bill specifies how electronic notarizations must be conducted. It also describes the committee of the National Conference of Commissioners on Uniform State Laws shall not be considered as authority in interpreting solely the Act.
The bill also describes eligibility requirements for a notary public. It also requires a notary public to secure an assurance or surety in the amount of $25,000. This bill specifies acts that a notary public is prohibited from taking. The bill also prohibits a notary public from engaging in false or misleading advertising. The bill allows a notary public to charge: (1) not more than $5 for certain notarial acts involving tangible records; and (2) not more than $15 for electronic notarizations. It allows a notary public to: (1) negotiate fees for certain notarial acts; and (2) charge for travel expenses.
What happens next: This bill was heard in the Senate Judiciary Committee on Feb. 1. The bill was amended to remove all references to establish electronic and remote notaries in Indiana. The bill was voted out of the committee as amended and is now eligible for second reading amendments.
HB 1511 – Liens on Towed Vehicles
Rep. Mike Braun, R-Jasper
Bill summary: This bill provides that a person who tows a vehicle at the request of a law enforcement officer has a mechanic's lien on the vehicle. HB 1511 also changes statutory notice provisions for mechanic’s liens on towed or abandoned vehicles in IC 9-22-6-2: If the person who holds the mechanic's lien has proof that the notice was mailed in accordance with subsection (e), actual receipt of the notice is not required.
What happens next: The bill was assigned to the House Judiciary Committee.
SB 90 – Doing Business or Marketing as a Cooperative
Sen. Jean Leising, R-Oldenburg
Bill summary: The bill provides that it is unlawful for a business entity that is not a cooperative or mutual entity to do the following: (1) use the terms "cooperative," "co-op," "mutual" or any derivative of those terms in a business entity name, if the use of the term would create a substantial likelihood of misleading the public by implying that the business entity is a cooperative or mutual entity; (2) advertise or represent the business entity to the public, its customers or prospective customers as a cooperative or mutual entity or as an entity operating on a cooperative or mutual basis. It defines the term "cooperative or mutual entity" – including mutual financial institutions. It requires the Indiana State Department of Agriculture (ISDA) to regulate the use of the terms "cooperative," "co-op," "mutual" and any derivative of those terms. It authorizes the revocation of a retail merchant's certificate and the use of civil penalties, administrative dissolution by the secretary of state (SOS) and administrative orders to enforce the restrictions on the use of the terms "cooperative," "co-op," "mutual" and any derivative of those terms. The bill provides for judicial review of the proceedings of the ISDA and the SOS. The bill specifies that certain cooperative or mutual entities are not subject to the enforcement provisions of the bill. The bill also provides that certain enforcement actions of the ISDA are not subject to the Administrative Orders and Procedures Act.
What happens next: The bill is scheduled for hearing on Monday, Feb. 6, in the Senate Agriculture Committee. Sign up for the IBA Insighter for more details.
FEDERAL GOVERNMENT RELATIONS NEWS
Action Alert: Urge Your House Members to Support the Repeal of the Durbin Amendment
During the last Congress, the Chairman of the Financial Institutions Subcommittee successfully included an industry-advocated provision in the Financial CHOICE Act that would repeal the so-called "Durbin Amendment," but it was not considered on the House floor before Congress adjourned. In the coming weeks, Congress will again consider this legislation in this new term and it is vitally important that the Durbin interchange amendment repeal language remains in the legislation. Bankers must actively engage members of Congress to urge them to support the repeal of the Durbin Amendment. Contact your member of Congress today to make your voice heard.
Donald Trump to Issue Executive Order Aimed at Scaling Back Dodd-Frank Today
President Donald Trump is expected today to issue an executive order to scale back the Dodd-Frank Act. In an interview, National Economic Council Director Gary Cohn indicated to The Wall Street Journal that Trump will sign an order directing the Treasury secretary and regulators to revise Dodd-Frank, and he plans another to undo a regulation scheduled to go into effect in April for the retirement-account advisory business. Cohn indicated that future orders will affect the Financial Stability Oversight Council and how the government oversees systemically important financial institutions. He also told The Wall Street Journal that the Treasury will attempt to overhaul Fannie Mae (FNMA) and Freddie Mac (FMCC) and, that under existing laws, the White House can change how the Consumer Financial Protection Bureau operates.
Court Rules Against CFPB Allies in PHH Case
A U.S. appellate court ruled against three groups trying to intervene in the Consumer Financial Protection Bureau’s appeal of a prior ruling that the bureau’s single-director structure is unconstitutional. The three groups—consisting of 17 Democratic state attorneys generals, Sen. Sherrod Brown (D-Ohio) and Rep. Maxine Waters (D-Calif.), and a consortium of consumer advocates—sought to intervene so they could participate in any appeal of the case to the Supreme Court.
In PHH v. CFPB, a three-judge panel from the U.S. Court of Appeals for the D.C. Circuit ruled in October that the agency concentrates “enormous executive power” in a director who cannot be removed except “for cause.” The court noted that, while other agency heads serve at the pleasure of the president or lead boards of directors, the CFPB director is virtually unaccountable to outside authority.
As a result, the court struck the “for cause” provision in the Dodd-Frank Act, allowing the president to dismiss the CFPB director at will. That decision also overturned a ruling by CFPB Director Richard Cordray to increase a $6 million administrative law judge penalty against PHH for violating RESPA to $109 million. Cordray’s decision held that PHH accepted payments for the referral of a settlement service business pursuant to a captive reinsurance arrangement, in violation of RESPA.
Trump Nominates Neil Gorsuch to Supreme Court
President Trump on Tuesday announced the nomination of Neil Gorsuch to fill the late Antonin Scalia’s seat on the Supreme Court. Gorsuch currently serves as a judge on the 10th U.S. Circuit Court of Appeals in Colorado.
Mnuchin, McMahon, Sessions Nominations Advance
The Senate Finance Committee on Wednesday voted to advance Steven Mnuchin’s nomination as secretary of the Treasury. The move came as Democrats boycotted the vote, with all Republicans voting in favor of Mnuchin.
In a bipartisan 18-1 vote, the Senate Small Business Committee on Tuesday voted to confirm Linda McMahon as administrator of the Small Business Administration. The Senate Judiciary Committee also approved Sen. Jeff Sessions’ nomination as attorney general by a party-line vote on Wednesday. All three nominees must now be approved by majority votes in the full Senate.
Trump Issues Order Aiming to Contain Cost, Volume of Regulations
President Trump issued an executive order on Monday aiming to restrain the growth in regulatory costs and volume. The order would require a net incremental budgetary cost of zero or less for most new regulations, while also requiring agencies in most cases to identify two regulations to be rescinded for every new one issued.
While the language of the order is not specific about what agencies are covered, news services reported on Monday that a White House spokeswoman indicated that independent regulatory agencies -- including most financial and banking regulators -- would be exempt.
Effective immediately, most executive departments and agencies will be required to maintain a total incremental budgetary cost of zero or less for all finalized regulations, unless required by law or approved by the director of the Office of Management and Budget. When proposing a new rule, an agency must identify two existing regulations to be rescinded, and it must offset new regulatory costs by eliminating the same costs from at least two regulations.
Starting with fiscal year 2018, the rule establishes an outline for a “regulatory budget,” with OMB providing each agency a total incremental cost cap on regulations in the upcoming fiscal year; agency heads will be required to avoid exceeding the cap and, in cases where a reduction in total regulatory costs is required, rescind or rewrite rules to meet the lower cap.
The order directs OMB to provide further details on how the order will be implemented and how costs will be accounted for. It also exempts regulations related to foreign affairs, defense or national security, as well as rules related to internal agency affairs or those exempted by the OMB. One major effect of the order would seem to be a significant increase in the power of OMB as manager of the regulatory budget that affected agencies must follow.
State Regulators Release BSA/AML Self-Assessment Tool
State regulators and the Conference of State Bank Supervisors have released a new voluntary self-assessment tool to help banks better manage Bank Secrecy Act and anti-money laundering risk. The tool is meant to help institutions better identify, monitor and communicate BSA/AML risk, reduce uncertainty surrounding BSA/AML compliance and foster greater transparency within the industry.