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There will not be an imme- diate impact to the bottom line until we have more clarity around the Trump administration’s priorities
for amending, delaying and re-proposing federal rules. Expectations are high for the Trump administration to ful ll its campaign promises of repealing or amending the Dodd-Frank Act, the A ord-
able Care Act and other Obama administration policies and regulations. However, quick action on many of these measures seems unlikely due to standing rules in the U.S. Senate and the di culties with unwinding complex laws and regulations.
The Obama administration rules most likely to be im- pacted are proposed and nal rules with an e ective date after Jan. 20, 2017 (when the new administration came to power). Rules that are nal and published in the Federal Register could require either new rule- making or review under the Administrative Procedure Act, Congressional Review Act or Paperwork Reduction Act. Congress has the statutory authority to amend, disapprove or modify current rulemakings and use the appropriations process to prohibit the use of federal funds to implement or enforce a rule. Even with Repub- lican majorities in the House and Senate, though, there are parliamentary hurdles to an outright repeal of the Dodd-Frank Act.
—Peter Dugas,
managing director of government a airs, Center of Regulatory Intelligence in Washington, D.C., FIS
Practically all important regulations a ecting the con- sumer nancial services industry are those issued by the CFPB. Other than mortgage regulations, the only nal substantive regulations impacting our clients in the payments industry are the remittances regulation issued several years ago and the prepaid accounts rule. Resolutions have been introduced in the House
and Senate to override the prepaid accounts rule under the Congressional Review Act (CRA), but I think it’s premature to prognosticate whether those resolutions will be passed. I also think Director Cor- dray is hesitant to nalize any new regulations out
of fear that Congress will override them under the [CRA], precluding the bureau from adopting substan- tially similar regulations in the future. That translates to good news for most of our clients since there is tremendous cost associated with compliance with new regulations.
—Alan S. Kaplinsky,
partner, Ballard Spahr LLP
The Trump administration—and its fellow Republicans in Congress—could make big changes to the CFPB. This could impact how that agency regulates and supervises the payments industry. First, a federal appeals court in Washington ruled unconstitutional a provision in the Dodd-Frank Act that enables the pres- ident to remove the CFPB director only “for cause.” The decision is stayed while the CFPB seeks further review, but this procedural technicality won’t prevent President Trump from relying on the decision’s rea- soning to assert that he has the authority to replace Cordray before the director’s term is scheduled to end in 2018. (Cue the headline: “Cordray, You’re Fired.”)
The question will be how fast a new leadership team can change the direction of such a large agency
and whether a regulator with a mandate myopically focused on consumer protection is institutionally predisposed to aggressive regulation, no matter who is in charge. Second, key people in Congress want legislation to curb the powers of the CFPB. Ideas that are being considered include replacing the director with a bipartisan commission, remov- ing its authority to police “abusive” practices—an authority that many critics contend is unbounded and that the agency, itself, has abused—and add- ing a mandate to foster competitive markets.
—David Beam,
partner, Mayer Brown LLP
volume 10 • spring 2017
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