Banking and Finance Law Daily Wrap Up, WORTH NOTING—Other regulatory, legislative, litigation, and industry developments, (Sep 26, 2025)

By WK Editorial Staff

A weekly roundup of other items of interest to the banking and finance law community.

BANKING OPERATIONS—U.S. commercial banks and savings associations reported $16.6 billion in trading revenue in the second quarter of 2025, according to the latest Quarterly Report on Bank Trading and Derivatives Activities issued by the Office of the Comptroller of the Currency. The figure marked a $1.6 billion, or 10.7 percent, increase from the previous quarter and was up 2.2 percent from a year earlier. The report authors said 1,217 insured banks held derivatives, with four large institutions accounting for 87.3 percent of total notional amounts. Derivative exposure rose, with net current credit exposure increasing 7.6 percent to $267 billion. Interest rate products made up the bulk of activity, totaling $148.7 trillion, or 66.5 percent of all derivative contracts.

BANK SECRECY ACT—The Federal Reserve Board’s Division of Supervision and Regulation has issued SR 25-3 to inform financial institutions under its supervision of special measures imposed by the Financial Crimes Enforcement Network (FinCEN). These measures, applicable to all covered financial institutions regardless of asset size, are designed to address entities identified as being of "primary money laundering concern" under various legislative acts. Specifically, the Combating Russian Money Laundering Act targets illicit finance related to Russian activities, allowing FinCEN to impose measures without rulemaking, and the FEND OFF Fentanyl Act similarly addresses illicit opioid trafficking. Financial institutions are required to take actions such as maintaining transaction records, obtaining beneficial ownership information, and potentially prohibiting or conditioning certain accounts and transmittals of funds. Institutions should consult FinCEN's rulemaking or orders for specific guidance on the nature and scope of these measures.

COMMUNITY DEVELOPMENT—The Federal Reserve Board has released the agenda for its annual community bank conference, which is set for October 9 at its Washington headquarters. The event, titled Community Banks: A Path Forward, will highlight issues facing the sector, including payments innovation, capital and liquidity standards, and shifting consumer expectations. The conference will feature leaders from across the financial and business sectors. Attendance is limited to invited guests, but the sessions will be livestreamed on the Fed’s website and YouTube. The Fed said the conference aims to foster dialogue on strategies to support their long-term viability.

COMMUNITY DEVELOPMENT—United States Sen. Dick Durbin (D-Ill.) and Rep. Emanuel Cleaver (D-Mo.), Ranking Member of the Financial Services Subcommittee on Housing and Insurance, jointly announced the introduction of the “Sparking Production of Urban and Rural (SPUR) Housing Act.” Chiefly, the SPUR Housing Act would require the Secretary of the U.S. Dept. of Housing and Urban Development (HUD) to “establish an emerging developer fund program to provide competitive grants to nonprofit housing organizations and community development financial institutions.” Commenting on the proposed measure, Rep. Cleaver stated, “The road to lowering housing costs for the American people begins with the increase in construction of affordable housing.” Similarly, Sen. Durbin remarked that the SPUR Housing Act “levels the development playing field and gives Black and Latino developers the resources and experience they need to build and grow their own companies” while fostering affordable housing and advancing community development projects.

CRIMES AND OFFENSES—The Office of Foreign Assets Control (OFAC) published a final rule formally implementing executive orders on Syria earlier this year, according to a notice scheduled for publication in the September 25 Federal Register. The final rule largely revokes Syria sanctions after the ousting of former leader Bashar al-Assad, based on Executive orders issued January 15 and June 30. The changes were due to go into effect immediately upon publication.

CRIMES AND OFFENSES—Senator Ron Wyden (D-Ore.), Ranking Member of the Senate Finance Committee, has written to JP Morgan Chase & Co. (JPMC), requesting information relating to an investigation “examining the extent to which compliance failures at major financial institutions like JPMC enabled Epstein’s sex trafficking crimes.” The letter seeks “to determine what bank executives knew about Epstein’s conduct and when they knew it.”

DEBT COLLECTION—In a non-precedential opinion, the U.S. Court of Appeals for the Third Circuit affirmed the dismissal of a consumer’s Fair Debt Collection Practices Act against a law firm that had filed a debt collection action against the consumer after the statute of limitations had expired. The consumer had not objected to the untimeliness of the suit, and a judgment was entered against her followed by a wage garnishment. Over a year after the law firm initiated the debt collection suit, the consumer filed a separate FDCPA action against the law firm which moved to dismiss the consumer’s suit based on the FDCPA’s one-year statute of limitations. In affirming the dismissal, the court held that the district court did not err in rejecting the consumer’s continuing violation theory to the FDCPA claim based on the law firm’s post-complaint court filings made in the untimely, but successful, debt collection suit, and that the law firm’s post-complaint debt collection efforts were not independently actionable under the FDCPA (Moore v. Cohn Lifland Pearlman Herrmann & Knopf LLP, No. 24-1456 (3rd Cir. Sept. 25, 2025)).

FAIR CREDIT REPORTING—A bill announced September 19 seeks to help build credit history for an estimated 26 million “credit invisible” Americans. The Credit Access and Inclusion Act—announced by Reps. Janelle Bynum (D-Ore.) and Young Kim (R-Calif.)—would specifically allow for on-time payment of items such as rent or utility bills to be purposed for credit reporting. The bill also includes a mandate for agencies to study the impact of expanded reporting on aspects such as cash flow or payroll deposit verification.

FINANCIAL STABILITY—Senator Elizabeth Warren (D-Mass.) called on Treasury Secretary Scott Bessent to provide details surrounding calls to help bolster the currency and financial markets of Argentina, in a letter dated September 22. “President [Donald] Trump’s close personal relationship with President [Javier] Milei, and the timing of this bailout ahead of a critical October 26 midterm election in Argentina, raise serious concerns that the purpose of this bailout is personal and political—and comes at the expense of the American people,” Warren wrote, questioning the labelling of Argentina as a “systemically important” ally. She referred to wording from the Treasury that the agency was ready to conduct “swap lines, direct currency purchases, and purchases of U.S. dollar-denominated government debt from Treasury’s Exchange Stabilization Fund” in seeking an explanation by September 26 of why the U.S. may be asked to “bail out” Argentina’s economy.

FINANCIAL STABILITY—Senator Bernie Sanders (I-Vt.), Ranking Member of the Senate Committee on Health, Education, Labor and Pensions, and Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking Committee, have led a coalition of Senate Democrats who are questioning the Trump administration’s treatment of economic data. Joined by 10 of their Senate colleagues, Sanders and Warren transmitted a Sept. 22, 2025, letter to the Director of the National Economic Council, Director of the Office of Management and Budget, and the Chief Statistician of the United States, requesting information on the Trump administration’s plans to implement changes to economic data collection, analyses, and reporting. Among other things, the letter: (i) grills the White House over a recent decision to delay the annual Consumer Expenditure Survey from the Bureau of Labor Statistics (BLS); and (ii) echoes warnings from economists and past BLS leaders that the delayed survey, as well as the high-profile firing of former BLS Commissioner Erika McEntarfer—following release of a July BLS report that significantly revised the number of new jobs added to the U.S. economy—threatens the public trust in the quality of the data. “Any erosion of confidence in the federal government’s data threatens to destabilize markets, reduce investment, and undermine America’s economic leadership globally,” the senators wrote. Further, the lawmakers requested that the three administration leaders respond by October 6 to questions about their respective efforts to improve data quality and public trust.

FINANCIAL TECHNOLOGY—A group of Democratic senators have unveiled a framework for market structure legislation aimed at regulating digital assets, which they said have grown into a $4 trillion global industry. The framework—released by Sens. Angela Alsobrooks (D-Md.), Lisa Blunt Rochester (D-Del.), Cory Booker (D-N.J.), Catherine Cortez Masto (D-Nev.), Ruben Gallego (D-Ariz.), Kirsten Gillibrand (D-N.Y.), John Hickenlooper (D-Colo.), Andy Kim (D-N.J.), Ben Ray Luján (D-N.M.), Adam Schiff (D-Calif.), Mark Warner (D-Va.), and Raphael Warnock (D-Ga.)—outlined seven pillars for legislation. Those include closing regulatory gaps in the spot market, clarifying digital asset classifications, bringing issuers and platforms under oversight, and addressing illicit finance, corruption, and abuse (see Banking and Finance Law Daily, Sept. 12, 2025). The lawmakers noted in a joint statement that their proposal was designed to guide bipartisan negotiations. “Achieving a strong, bipartisan outcome will require time and cannot be rushed,” they said.

MORTGAGES—A bill announced September 19 would establish a threshold for mortgage borrowers to no longer need pay premiums for Federal Housing Administration (FHA) insurance. The Mortgage insurance Freedom Act—announced by Reps. Gregory Meeks (D-N.Y.) and Pete Session (R-Texas)—would automatically end the premium payments once a borrower's loan-to-value (LTV) ratio reaches a threshold similar to that currently in place for non-FHA borrowers paying private mortgage insurance premiums.

MORTGAGES—U.S. mortgage performance improved slightly in the second quarter of 2025, according to the latest Mortgage Metrics Report that was published September 24. The Office of the Comptroller of the Currency report found 97.5 percent of first-lien mortgages current and performing, up 97.3 percent from the year prior. The share of seriously delinquent mortgages—loans 60 or more days past due or held by bankrupt borrowers behind on payments—also fell compared with the same period in 2024. The report further noted servicers initiated 7,163 new foreclosures between April and June, down from the prior quarter but higher than a year earlier. Loan modifications rose 6.7 percent from the first quarter, totaling 8,419, with nearly 95 percent classified as “combination modifications,” which adjust multiple loan terms to improve affordability. The OCC’s quarterly report covers about 10.8 million loans worth $2.7 trillion, or roughly 20 percent of outstanding U.S. mortgage debt. The data, current through June 30, reflects mortgages serviced by seven large national banks.

OVERSIGHT AND INVESTIGATION—Democrats pressed the Commerce Department’s acting Inspector General to investigate potential ethics violations over military technology sales to the United Arab Emirates (UAE), according to a letter that was released September 24. The letter claims the White House’s “Crypto Czar” David Sacks and Special Envoy to the Middle East Steve Witkoff publicly defended the decision to relax sales of “sensitive national security technology” after having not disclosed close financial ties to UAE’s national security advisory Sheikh Tahnoon bin Zayed Al Nahyan. Nahyan is purportedly part of a deal involving a $2 billion investment in a stablecoin connected to Witkoff and the President, as well as an early- and ongoing investor in Craft Ventures, an investment fund at which Sacks remains a “general partner.” The letter stated, “Reports indicated that [Sacks and Witkoff] overrode the concerns of national security officials who raised alarms about the UAE’s close ties with the [People’s Republic of China] and its offensive cyber capabilities, including concerns that the UAE would help China ‘gain access to Emirati data centers, accelerating its efforts to build A.I-enhanced weapons that could someday be deployed against American soldiers,’” The letter was signed by Sens. Elissa Slotkin (D-Mich.) and Elizabeth Warren (D-Mass.) said. In addition to the Commerce Department’s IG, the request to “undertake a switch and thorough evaluation of these allegations” was also addressed to the acting Inspector General for the State Department and the acting Director of the U.S. Office of Government Ethics.

SECURED TRANSACTIONS—Wis. App.: Reviewing provisions of the Wisconsin Uniform Commercial Code (UCC) and the Wisconsin Consumer Act (WCA), an intermediate appellate court in Madison, Wisconsin examined the sufficiency of pre- and post-sale notices provided by a creditor, Simplicity Credit Union, to a pair of consumers. The consumers had defaulted on their loan agreement, which was secured by a vehicle the consumers owned, and Simplicity Credit repossessed the vehicle and sold it. In their proposed class action against Simplicity Credit, the consumers alleged that the pre- and post-sale notices to them were not legally sufficient under the Wisconsin UCC because the notices did not incorporate certain information from § 425.210 of the WCA. More specifically, the consumers contended that, consistent with WCA § 425.210, the notices were “required to describe the deficiency as the difference between the loan balance and the fair market value of the vehicle, rather than as the difference between the loan balance and the vehicle’s sale price.” Ultimately, in reviewing the interplay between provisions of the Wisconsin UCC and the WCA, the appellate court decided that Simplicity Credit’s pre- and post-sale notices were legally sufficient and that the state trial court had properly granted summary judgment in favor of Simplicity Credit and properly dismissed the consumers’ complaint. In reaching its decision, the appellate court conclude that “§ 425.210 of the WCA does not alter what is required by the UCC’s notice provisions and that Simplicity’s notices were sufficient under the UCC” (Birge v. Simplicity Credit Union, No. 2024AP567 (Wis. App. Sept. 18, 2025)).

Attorneys: Mark H. Jensen (Kim Law Firm) for Helisha Moore. Michael I. Goldman (Lydecker Diaz LLC) for Cohn Lifland Pearlman Herrmann & Knopf LLP. Nathan Deladurantey (Deladurantey Law Office, LLC) for Daniel Birge. Jennifer Lynn Williams (Downey Brand LLP) for Simplicity Credit Union.

Companies: Cohn Lifland Pearlman Herrmann & Knopf LLP; Simplicity Credit Union

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