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PH FedACTion: Financial Regulatory Updates

Daily Financial Regulation Update -- Wednesday, August 5, 2020

August 05, 2020

By FedACTion Task Force

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Major Developments


to view the full text of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), Enacted March 27, 2020.

to view the full text of the Paycheck Protection Program Increase Act of 2020, Enacted April 24, 2020.

to view the full text of the Paycheck Protection Program Flexibility Act of 2020, Enacted June 5, 2020.

from the Senate Committee on Banking, Housing, and Urban Affairs, Senate Committee on Small Business and Entrepreneurship, House Committee on Financial Services, and House Committee on Small Business.

U.S. Senate

Committee on Banking, Housing, and Urban Affairs

Brown, Colleagues Urge Congressional Leaders to Ban Arbitration Clauses Attached To Needed Benefits

August 4, 2020

U.S. Senators Sherrod Brown (D-OH), Ranking Member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs (Banking Committee), and Robert Menendez (D-NJ), a senior member of the both the Banking Committee and the U.S. Senate Committee on Finance, requested that negotiators of the pending COVID-19 stimulus package affirmatively prohibit the federal government from attaching forced arbitration agreements to any form of benefit payments. Pre-paid debit cards, loaded with CARES Act stimulus payments, distributed last spring by the Internal Revenue Service to four million Americans, contained an arbitration clause in the terms and conditions accompanying the cards.

Federal Agencies

Federal Reserve Bank of New York

New York Fed Releases Brief on COVID-19’s Effects on Black-Owned Businesses

August 4, 2020

The Federal Reserve Bank of New York released a brief (Brief) discussing the effects of COVID-19 on Black communities and Black-owned businesses. The Brief examines why Black-owned firms have been almost twice as likely as firms overall to shutter during the COVID-19 pandemic.

New York Fed Publishes Blog Post on Tracking the COVID-19 Economy with WEI

August 4, 2020

The Federal Reserve Bank of New York published a Liberty Street Economics blog post (Blog Post) entitled, “Tracking the COVID-19 Economy with the Weekly Economic Index (WEI)”. At the end of March, 2020, the Blog Post’s authors launched the WEI as a tool to monitor changes in real activity during the COVID-19 pandemic. The Blog Post documents the performance to date of the WEI, and offers some guidance on evaluating the WEI’s forecasting abilities based on 2020 data, and interpreting WEI updates and revisions.

Securities and Exchange Commission

SEC’s Division of Corporation Finance Issues Announcement on Submission of Supplemental Materials Subject to Rule 83 Confidential Treatment Requests

August 4, 2020

The U.S. Securities and Exchange Commission’s Division of Corporation Finance (CorpFin) announced that, in light of ongoing health and safety concerns related to COVID-19, CorpFin is providing a temporary secure file transfer process for the submission of supplemental materials pursuant to Rule 418 under the Securities Act of 1933, and Rule 12b-4 under the Securities Exchange Act of 1934, and information subject to Rule 83 confidential treatment requests.

Commodity Futures Trading Commission

CFTC Advisory Warns Customers Regarding Precious Metals Pitches Touting CARES Act Rules

August 4, 2020

The Commodity Futures Trading Commission (CFTC) issued aCustomer Advisory, in an attempt to educate the public about unregistered gold and silver dealers advising investors to use relaxed rules under the CARES Act to purchase precious metals. The Customer Advisory notes that, “since the CARES Act was enacted . . . the CFTC has observed a growing trend of precious metals promoters and dealers encouraging investors to use the CARES Act distribution rules to convert their retirement savings into investments of gold or silver coins, self-directed gold individual retirement accounts (IRAs), or make leveraged purchases of physical metals.”

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