Paul Hastings

December 12, 2024- The Consumer Financial Protection Bureau issued a final rule addressing overdrafts, applicable to banks and credit unions w...

A significant headwind for companies in the digital asset space is that they have reportedly struggled to secure and maintain relationships with banks, in what is now called “Choke Point 2.0.” With the incoming Trump Administration and the expectation that pro-crypto officials will assume key roles, we expect a shift in federal banking agencies’ formal regulatory policies and supervisory posture related to digital assets and banking. Key appointments at the Board of Governors of the Federal Reserve System (Federal Reserve), Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Corporation (FDIC) (together, the federal banking agencies) are expected to establish a more collaborative relationship with the digital asset industry rather than exercise what has been perceived as an adversarial stance.

The CFTC Division of Enforcement recently released its 2024 results, trumpeting its focus on large crypto matters that generated big headlines and...

Major Developments Office of the Comptroller of the Currency OCC Reports on Key Risks in Federal Banking System December 16, 2024

On December 11, 2024, the Court of Appeals for the Fifth Circuit issued a decision in Alliance for Fair Board Recruitment v. SEC vacating the SEC’s approval of Nasdaq’s board diversity rules. The rules required tabular disclosure of voluntary self-identified gender, racial characteristics and LGBTQ+ status of a Nasdaq-listed company’s board of directors and required companies to have two directors who would be considered “diverse” or otherwise explain why they did not. As a result of the decision, Nasdaq-listed companies are no longer required to comply with these rules but may choose to retain certain board diversity disclosures on a voluntary basis.

Representatives Send Letters to Administration Regarding Recent Rulemakings

The Federal Open Markets Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4-1/4 to 4-1/2 percent. The Board of Governors of the Federal Reserve System voted unanimously to lower the interest rate paid on reserve balances to 4.4 percent, effective December 19, 2024.

Paul Hastings released its SEC Cyber Incident Disclosure Report today, providing a unique look at how public companies have responded to new incident disclosure requirements. The Securities Exchange Commission (SEC) approved new rules in July 2023 around Cybersecurity Risk Management, Strategy, Governance and Incident Disclosures, requiring public companies to disclose material cybersecurity incidents that impact their organizations within 96 hours of determining that they are “material.”

This week, Congress wrapped up its final session of the 118th Congress. Crypto legislation in the next Congress will likely be based on the bills...

Treasury Releases Report on the Uses, Opportunities, and Risks of Artificial Intelligence in Financial Services