Regulations & Policy
Sen. Elizabeth Warren, D-MA, and Rep. Robert Garcia, D-CA, introduced a bill Thursday that would require federal financial regulators to publicly disclose supervisory records, including internal communications, concerning Jeffrey Epstein and his associates. The legislation would also compel agencies like the Federal Reserve, OCC, FDIC, and SEC to investigate Epstein-connected banks and executives, with possible industry bans, fines, or Justice Department referrals. Warren expressed dissatisfaction with regulators' responses to her inquiries, citing letters from Fed Vice Chair Michelle Bowman and Comptroller Jonathan Gould that declined to confirm specific investigations. The bill, which has cross-party support from Rep. Thomas Massie, R-KY, is unlikely to pass this year but could gain traction if Democrats win majorities in November. JPMorgan Chase, Bank of America, and Deutsche Bank have paid over $400 million combined to settle victim lawsuits, but only Deutsche Bank has paid an Epstein-related penalty to a U.S. regulator.
SEB and its New York branch will pay $33 million to resolve a NYDFS investigation into its AML program, which stemmed from the Panama Papers leak. The regulator found deficiencies in customer due diligence, risk assessment, and transaction monitoring in the Baltics between 2015 and 2019. SEB is the fourth bank fined by NYDFS in connection with the scandal. The bank said the penalty will have limited financial impact and concludes historic AML issues with U.S. authorities.
Payward, the parent company of crypto exchange Kraken, has agreed to acquire Lithuania-based Saldo Bank and its Finnish holding company. The deal, expected to close in 2027, would give Payward an EU banking license, upgrading from its current electronic money institution license. This follows other licensing advancements, including a master account from the Federal Reserve Bank of Kansas City and an application for a national trust bank charter. The acquisition is expected to enable Payward to offer interest on deposits, lending products, and banking-as-a-service capabilities in Europe. Saldo Bank is licensed in Lithuania and passportable to Finland, Sweden, Germany, and the Netherlands.
The Office of the Comptroller of the Currency (OCC) published a 47-page follow-up report alleging that nine banks under its supervision, including JPMorgan Chase, Bank of America, Citi, Wells Fargo, U.S. Bank, PNC, Capital One, TD, and BMO, held policies or practices between 2020 and 2025 that may have influenced debanking based on customers' political or religious leanings. Comptroller Jonathan Gould said the report provides 'irrefutable evidence' of discrimination and emphasized further regulatory changes may be needed. Several banks responded, with JPMorgan stating its policies prohibit such discrimination and that it has improved its practices. The CFPB also announced it will investigate whether the institutions complied with federal consumer financial laws.
President Donald Trump has established a three-person 'committee of inquiry' to investigate mortgage fraud allegations against Federal Reserve Governor Lisa Cook, the White House announced Friday. The committee, comprising Kevin Hassett, Keith Sonderling, and Andrea Lucas—all Trump nominees—will hold a closed hearing on Nov. 5 where Cook can present evidence and a written statement. The move follows a Supreme Court 5-4 ruling in June that Cook did not receive due process when Trump attempted to fire her in August 2025. Cook's attorneys have expressed 'grave doubts' about the legitimacy of the hearing, while Senate Democrats criticize it as an 'illegitimate show trial.' The timing of the hearing, after the midterm elections, and the potential replacement of Cook with Hassett or Judy Shelton, are noted.
President Donald Trump has established a three-person 'committee of inquiry' to investigate mortgage fraud allegations against Federal Reserve Governor Lisa Cook, the White House announced Friday. The move follows a Supreme Court ruling in June that Cook did not receive due process when Trump attempted to fire her in 2025. The committee, composed of Trump nominees Kevin Hassett, Keith Sonderling, and Andrea Lucas, will hold a closed hearing on Nov. 5 where Cook can present her case. Cook's attorneys have expressed doubts about the legitimacy of the hearing, while Senate Democrats criticize it as an illegitimate show trial. The timing of the hearing, after the midterm elections, and the recent hiring of economist Judy Shelton at the Treasury Department, suggest political calculations. The committee will recommend to Trump whether he has cause to remove Cook after Nov. 10.
Sen. Elizabeth Warren has written to the NCUA's acting inspector general, Marta Erceg, demanding answers about a two-week lapse in leadership at the National Credit Union Administration in August, when all three board seats were vacant from former Chair Kyle Hauptman's departure on Aug. 7 until John Crews was sworn in on Aug. 24. Warren cited a Law360 report saying the situation appears to have no obvious modern precedent among federal financial regulators and asked how the agency operated during that time, who was responsible for decision-making, and whether the vacuum constrained or delayed payments to insured depositors of the failed African Diaspora Federal Credit Union. The NCUA OIG and NCUA did not immediately respond to requests for comment.
The Office of the Comptroller of the Currency and the Federal Reserve issued enforcement actions against American Express and its subsidiaries on Thursday for anti-money laundering failures. American Express National Bank received a cease-and-desist order and a $350 million civil money penalty from the OCC, while Amex and its travel-related services arm received a cease-and-desist from the Fed. The OCC said the bank failed to tailor its BSA/AML risk assessment to its business activities and had systemic breakdowns in suspicious activity monitoring, resulting in roughly $13 billion of suspected trade-based money laundering activity between June 2014 and May 2025. Amex CEO Stephen Squeri said the company takes its responsibility seriously and will address regulators' concerns. The penalty is the first civil money penalty imposed on a bank by the OCC since October 2024.
HUD has accused Wells Fargo of discriminatory lending in violation of the Fair Housing Act, according to a letter sent to CEO Charlie Scharf. The investigation will examine the bank's 2017 $60 billion lending commitment to create at least 250,000 African American homeowners by 2027 and its 2022 $150 million special purpose credit program for Black homeowners to refinance at lower rates. HUD Assistant Secretary Craig Trainor criticized the previous administration for using special purpose credit programs to import racial discrimination into the housing market, calling Wells Fargo the 'first mortgage lender to make a public commitment' to implement a racialized home loan policy. A Wells Fargo spokesperson declined to comment. The 2022 program followed Biden-era guidance encouraging such credit programs, which was rescinded in August. HUD Secretary Scott Turner stated that even if Wells Fargo did not violate the law, its practice of dividing Americans based on race is immoral, unethical and un-American.
The Federal Reserve is restructuring its bank supervision function into five regions defined by state borders rather than reserve bank district boundaries, Michelle Bowman, the central bank's vice chair for supervision, said Tuesday. The move, informed by the Conference of State Bank Supervisors' regional structure, is designed to implement accountability and clear decision-making authority. The Fed also plans to improve the role of committees, as Bowman noted a complex web of committees has caused delays and obfuscated responsibility. Regional leaders will be held accountable for supervisory activity within their zones, while examiners remain at existing reserve bank locations. Critics, including Better Markets' Christopher Appel, are skeptical that the reorganization will lead to earlier risk identification and escalation, citing the need for cultural change. Bowman also said the Fed will consider broader structural reforms later this year.