This site presents free supplemental materials for Barr, Jackson & Tahyar, Financial Regulation: Law and Policy (Foundation Press, 2d ed., 2018). For the most part, the materials posted here are organized by chapter and cover important developments since the second edition went to press in the first quarter of 2018. In a limited number of cases, we also include older documents that some instructors may wish to emphasize in their courses. For the 2020-21 academic year, we have added an overview of The Financial Response to the COVID-19 Pandemic. This overview summarizes the key public responses to the pandemic and includes links to the growing academic literature on financial aspects of the crisis responses. The overview also includes in the footnotes cross-references to the various section of the textbook where relevant legal regimes are discussed in greater detail.
The authors are currently at work on the third edition of the textbook, which will be current through December 2020 and available for review or purchase in Spring 2021. Among other things, the third edition will include an expanded Part VIII with additional materials on supervision, compliance, and enforcement. We will also be expanding our treatment of Fintech issues and integrating our overview of the COVID-19 pandemic into the text, as well as more routine updates for recent developments.
If you have any suggestions about additional materials that should be posted here or included in the third edition, please feel free to contact Howell Jackson at email@example.com.
Here’s an errata sheet for the second edition.
Updated: August 1, 2020
The Financial Response to the COVID-19 Pandemic
As the COVID-10 Pandemic will undoubtedly be posing important questions of financial regulation during the 2020-2021 academic year and beyond, we have prepared an overview of the financial responses to the pandemic available on SSRN, Michael S. Barr, Howell E. Jackson, and Margaret E. Tahyar The Financial Response to the COVID-19 Pandemic. It includes references to the growing literature on the pandemic as well as a number of resources that will be updated as the year progresses. While instructors could use this overview in a number of different ways, one approach would be to assign the document for preliminary review early in the semester and then to return to it from time to time as you cover specific topics that are affected by the pandemic.
Fintech Law: The Case Studies
Over the past two years, two of the authors – Howell Jackson and Meg Tahyar – have been teaching a Fintech module at Harvard Law School and have developed a series of fourteen case studies that offer students an opportunity to explore the kinds of challenges that technological developments are posing for practicing attorneys in the field of financial regulation. These case studies have now been published in an eBook, Howell E Jackson & Margaret E. Tahyar, Fintech Law: The Case Studies (July 2020). There is also a Teacher’s Manual available to instructors upon request. Additional case studies on other topics of financial regulation are available from the Harvard Law School Library. All of these case studies are also listed below following the relevant chapters of the textbook.
1.1. Finance Today
- 2019 FSOC Annual Report
- Federal Reserve Financial Stability Report (May 15, 2020)
- Treasury Releases Report on Nonbank Financials, Fintech, and Innovation (Jul. 31, 2018)
- 2020 Banking Regulatory Outlook (Deloitte)
- Ben Bernanke, The Real Effects of the Financial Crisis, (Brookings, 2018).
- 2020 FSAP Report
1.2. The History of U.S. Financial Regulation: A Thematic Overview
- Brookings and Yale School of Management: Charting the Financial Crisis (Aug. 29, 2018)
- The Federal Reserve’s Actions to Address the Coronavirus Crisis, Davis Polk (May 22, 2020)
- H.R. 748, CARES Act (March 27, 2020)
- [Paywall] Jason Bellini, What’s in the $2 Trillion Senate Coronavirus Bill (The Wall Street Journal, March 26, 2020)
1.3. Regulatory Frameworks
- Additional readings on proposals for reforming regulatory structures in the United States:
- Reshaping the Financial Regulatory System: Long Delayed, Now Crucial (Volcker Alliance, 2015)
- Elizabeth Brown, Prior Proposals to Consolidate Federal Financial Regulators (Apr. 20, 2015)
- Seila Law LLC v. CFPB, No. 19-7 (U.S. Supreme Court, June 29, 2020) (invalidating the for-cause removal protections of the CFPB Director contained in the Dodd Frank Act)
- Rory Van Loo, Rise of the Digital Regulator, 66 Duke L. Rev. 1267 (2019) (proposing the creation of a new meta-agency to deal with technology)
- For a review of cost benefit analysis in financial regulation and an exploration of the measurement of benefits in consumer protection contexts, see Howell E. Jackson & Paul Rothstein, Benefit Analysis in Consumer Protection Regulation, 9 Harv. Bus. L. Rev. 101 (2019).
- Chris Brummer, What do the Data Reveal About (the Absence of Black) Financial Regulators?, (working paper) (Jul. 2020)
1.4. The Regulatory Perimeter
- CRS Report, Federal Preemption in the Dual Banking System (May 17, 2019)
- For a discussion of regulatory perimeters in the context of Fintech innovations, see Howell E. Jackson, The Nature of the Fintech Firm and its Implications for Financial Regulation, in Howell E. Jackson & Margaret Tahyar, Fintech Law: The Case Studies (July 2020) (avail. at https://projects.iq.harvard.edu/fintechlaw)
1.5. A Tour of Financial Statements
HLS Case Studies for Part I
- HLS Case Study - Federal Preemption of State Consumer Protection - Aug. 2017-- Case study exploring preemption after the Dodd-Frank Act; could be used as an extension of discussion in Chapter 1.4 or in connection with Part V.
- HLS Case Study - Unidentified Financial Institutions - Apr. 2018 -- Exercise on balance sheets and income statements that could be used in connection with Chapter 1.5 to explore basic concepts of accounting.
2.1. The Impact of Charter Choice
In July of 2018, the Treasury Department issued a report on FinTech and Innovation, prompting a number of related actions and raising questions about legal challenges dismissed previously on procedural grounds.
- Comptroller’s Licensing Manual Supplement: Considering Charter Applications From Financial Technology Companies (Jul. 31, 2018)
- OCC Policy Statement on Financial Technology Companies’ Eligibility to Apply for National Bank Charters (Jul. 31, 2018)
- U.S. Department of the Treasury, A Financial System That Creates Economic Opportunities: Nonbank Financials, Fintech, and Innovation (Jul. 2018)
- Vullo v. Office of Comptroller of Currency, 378 F.Supp.3d 271 (S.D.N.Y. 2019)
- FDIC Proposal for ILC holding company (Mar. 2020)
- Lacewell v. Office of Comptroller of Currency, 2019 WL 6334895 (S.D.N.Y. Oct. 21, 2019)
For a pair of amicus briefs taking opposing positions OCC chartering powers, see:
- David Zaring Amicus Brief in support of the OCC (Apr. 30, 2020)
- Banking Law Scholars Amicus Brief in support of the NYDFS (Jul. 29, 2020)
- FDIC Approves the Deposit Insurance Application for Square Financial Services, Inc., Salt Lake City, Utah (Mar. 18, 2020)
- Davis Polk Visual Memo, Cannabis Banking (Apr. 16, 2019)
2.2. Activities Restrictions and the Business of Banking
2.3. Portfolio Diversification and Affiliate Transactions
- Federal Reserve Final Rule to Extend Compliance Dates on Single-Counterparty Credit Limits for Bank Holding Companies and Foreign Banking Organizations (May 29, 2020)
2.4. Deposit Insurance
- FDIC Brokered Deposits Notice of Proposed Rulemaking (Dec. 12, 2019)
- Rajdeep Sengupta, The Global Pandemic and Run on Shadow Banks, Fed. Res. Bank Kansas (May 11, 2020).
2.5. Capital Regulation: An Introduction
2.6. Capital Regulation: Pre-Financial Crisis to Basel II
2.7. Capital Regulation: Basel III and Beyond
On May 24, 2018, President Trump signed into law the "Economic Growth, Regulatory Relief, and Consumer Protection Act," which, among other things provided regulatory relief for smaller and certain regional banking organizations.
- S. 2155, Economic Growth, Regulatory Relief, and Consumer Protection Act (May 24, 2018)
- Randal Quarles, “A New Chapter in Stress Testing” (Nov. 9, 2018)
- Federal Reserve Final Rule regarding Tailored Regulatory Framework (Nov. 1, 2019)
- Lael Brainard, Statement on Final Rule Regarding Tailored Regulatory Framework (Oct. 10, 2019)
- “Off the Rack”: Federal Reserve Finalizes Tailoring Rules with Few Changes (Davis Polk, Oct. 11, 2019)
- FDIC NPR, Company-Run Stress Testing Requirements for FDIC-Supervised State Nonmember Banks and State Savings Associations (Dec. 28, 2018)
- OCC NPR, Amendments to the Stress Testing Rules for National Banks and Federal Savings Associations (Feb. 12, 2019)
- Bank Capital Plans and Stress Tests (Sullivan & Cromwell, Dec. 27, 2018)
- Daniel Tarullo, “Taking the Stress Out of Stress Testing” (May 21, 2019)
- FDIC, Federal Reserve, OCC NPR, Regulatory Capital Rule: Capital Simplification for Qualifying Community Banking Organizations (Feb. 8, 2019)
- Lael Brainard, Statement on US Enhanced Prudential Standards Tailoring Proposals (Oct. 31, 2018)
- Lael Brainard, Statement on Proposals to Modify Enhanced Prudential Standards for Foreign Banks and to Modify Resolution Plan Requirements for Domestic and Foreign Banks (Apr. 8, 2019)
- Federal Reserve, FDIC, OCC Final Rule, Liquidity Coverage Ratio Rule: Treatment of Certain Municipal Obligations as High-Quality Liquid Assets (May 30, 2019)
- Federal Reserve Announces it Will Limit the Use of the “Qualitative Objection” in its CCAR exercise (Mar 6, 2019)
- Federal Reserve, FDIC, OCC Allow Three Year Regulatory Capital Phase-in For New CECL Accounting Standard (Dec. 21, 2018)
- Federal Reserve Proposal to Modify Company-run Stress Testing Requirements (Jan. 8, 2018)
- Final Rule on Community Bank Leverage Ratio (Nov. 13, 2019)
- Federal Reserve Final Rule on the Stress Capital Buffer and Changes to the Capital Plan rules (Mar. 18, 2020)
- Lael Brainard, Statement on Federal Reserve’s Final Rule on the Stress Capital Buffer and Changes to the Capital Plan Rules (Mar. 4, 2020)
- Dodd-Frank Act Stress Test 2020: Supervisory Stress Test Results (June 2020)
- Lael Brainard, Statement Against Federal Reserve’s Decision Permitting Banks to Pay Dividends after the Stress Test Results (June 25, 2020)
- Assessment of Bank Capital during the Recent Coronavirus Event (June 2020)
- Anil Kashyap, Raghuram Rajan, and Jeremy Stein, Rethinking Capital Regulation (Aug. 2008)
HLS Case Studies for Part II
- HLS Case Study – The OCC’s FinTech Charter: Testing the Scope of the OCC’s Chartering Powers - Aug. 2017 – This case study could be used in connection with Chapter 2.1 to explore the chartering authority of the OCC. Explores the issue from the perspective of Senate Banking Committee staff.
- HLS Case Study - Fintech Charters - May 2020 - Senate staffers examine the case for legislative changes with respect to Fintech chartering ahead of a congressional hearing.
- HLS Case Study - Exercise on Alternative Strategies for Depository Institutions -- Exercise could be used in connection with Chapter 2.2 to explore incentives of bank shareholders with respect to the allocation of bank assets.
- HLS Case Study - Strategic Options and Legal Risks for Elite ReFi, Inc. June 2020 - A marketplace lender attempts to negotiate legal uncertainties arising out of the Madden litigation and its aftermath.
3.1. Introduction to Insurance Regulation
- U.S. Department of the Treasury, A Financial System That Creates Economic Opportunities: Asset Management and Insurance (Oct. 2017)
3.2. The Protection of Consumers in Insurance Regulation
- University of Michigan Study, Auto Insurance and Economic Mobility in Michigan: A Cycle of Poverty (Mar. 2019)
- Joshua Rivera Testimony, House Financial Services Hearing (May 1, 2019)
- Governor Gretchen Whitmer, press release on auto insurance examination order (May 1, 2019)
- Michigan Radio NPR, Report: Auto Insurance Unaffordable in 97% of Michigan Zip Codes (Mar. 28, 2019)
- Michigan Senate Bill 1, Auto Insurance Reform Bill (May 7, 2019) (bill page)
3.3. The Role of Federal Government in Insurance Regulation
- Federal Reserve Board Proposed Rulemaking on Risk-Based Capital Requirements for Depository Holding Companies Significantly Engaged in Insurance Activities, 84 Fed. Reg. 57,240 (Oct. 24, 2019)
- MaryBeth Musumeci, Explaining Texas v. U.S.: A Guide to the Case Challenging the ACA (Kaiser Family Foundation Issue Brief, Mar. 2020).
- Brief for the Federal Respondents in State of California v. State of Texas, No. 19-840 (filed June 2020) (arguing that individual mandate of the ACA is unconstitutional and not severable from the balance of the ACA). For additional information on the ACA, legal challenges, and reform proposals, see here.
HLS Case Studies for Part III
- HLS Case Study - Ames’ Auto Insurance Regulations - Racial Disparity - Aug. 2017 -- Case study could be used in connection with Chapter 3.2 to explore racial disparities in automobile insurance rates.
4.1. Introduction to the Regulation of Securities Firms
- U.S. Department of the Treasury, A Financial System That Creates Economic Opportunities: Capital Markets (Oct. 2017) -- Treasury Department report with numerous recommendations related to securities firms and capital markets.
- SEC ICO page
- A New Vision For Europe’s Capital Markets: Final Report of the High Level Forum on the Capital Markets Union (June 2020)
4.2. Securities Firms and the Retail Investor
The fiduciary duty rule promulgated by the Obama Administration's Department of Labor has been a focus of criticism by the Trump Administration and was eventually invalidated by the Fifth Circuit in Spring of 2018. Shortly thereafter the SEC intervened with a related set of proposals, including a proposed Regulation Best Interest. These postings summarize those developments:
- SEC Final Rule on Regulation Best Interest (Jun. 5, 2019)
- Robert Jackson dissent regarding the SEC final rule on regulation best interest (Jun. 5, 2019)
- SEC Interpretation of Standard of Conduct for Investor Advisers (Jun. 5, 2019)
- SEC Adopts Broker-Dealer Best Interest Standards and Publishes Key Interpretations (K&L Gates, Jun. 6, 2019)
- A Firm’s Guide to the Implementation of Regulation Best Interest and the Form CRS Relationship Summary (SIFMA & Deloitte, Sept. 27, 2019)
- For an update on the implementation of Regulation Best Interest with a focus on its interactions with state reforms, see Daiva Sindaraviciute, Development of Fiduciary Duty: Is the Regulation Best Interest in the Best Interest of the Retail Investor? (Apr. 2020)
- Department of Labor Press Release on Proposal to Improve Investment Advice and Enhance Financial Choices for Workers and Retirees (June 29, 2020)
- For a more general discussion of the application of fiduciary duties in a regulatory context, see Howell E. Jackson & Talia B. Gillis, Fiduciary Law in Financial Regulation, in Oxford Handbook of Fiduciary Law (Even J. Criddle, Paul B. Miller, & Robert H. Sitkoff, eds., 2019)
4.3 Securities Firms in Corporate Transactions
In chapter 4.2, we explored the use of arbitration to resolve investor disputes with respect to securities firms. In recent years, proposals have been made to extend arbitration to securities litigation by corporate shareholders:
- Jay Clayton, Statement on Shareholder Proposals Seeking to Require Mandatory Arbitration Bylaw Provisions (Feb. 11, 2019)
- Hal S. Scott, The SEC’s Misguided Attack on Shareholder Arbitration (Wall St. J., Feb. 21, 2019)
- Delaware Supreme Court Rejects Facial Challenge to Federal Forum Provisions (Wachtell, Lipton, Rosen & Katz, Mar. 19, 2020)
4.4. Exchanges and Trading
Recent developments related to SEC Market Reforms:
- [Paywall] Alexander Osipovich, IEX Exchange Has Wall Street Fame But No Listings (WSJ, Jul. 29, 2018)
- Memorandum on CBOE Speed Bump (Mar. 27, 2020)
- NASDAQ v. SEC, 961 F. 3d 421 (D.C. Cir. 2020) (vacating SEC decision reversing ALJ’s ruling in favor of exchanges on depth-of-book data). For background on this development, see Memorandum on Depth-of-Book Litigation (Mar. 22, 2020)
- NYSE v. SEC, 962 F. 3d 541 (D.C. Cir. 2020) (vacating SEC’s transaction fee pilot program). For background on this development, see Memorandum on Transaction Fee Pilot Program Litigation (Feb. 11, 2020)
HLS Case Studies for Part IV
- HLS Case Study - Lending Club - May 2020 -- This case study could be used in connection with Chapter 4.1 to explore the definition of securities under federal securities law.
- HLS Case Study – Robo-Advising April 2020 – This case study could be used in connection with Chapter 4.2 to explore the application of traditional broker-dealer regulation to a new robo advisers. Explores legal issues from the perspective of SEC, FINRA, and Treasury Department staff.
- HLS Case Study - Market Manipulation: Definitional Approaches - June 2020 - SEC staff asked to analyze the potential changes to defining manipulation in light of problems caused by algorithmic trading and to assess administrative law options for implementing such changes.
- HLS Case Study - Algorithmic Trading Strategies - May 2020 - The CFTC Division of Market Oversight examines problems associated with algorithmic trading and a possible initiative of the CFTC to require firms to disclose confidential information about their algorithms.
- HLS Case Study - Regulating Crypto Assets: Securities and Commodities - April 2020 - An attorney working at the Bipartisan Policy Center explores the regulation of digital assets, attempting to develop a policy position with respect to SEC and CFTC jurisdiction over these products.
5.1. The Consumer Financial Protection Bureau
- Seila Law LLC v. Consumer Financial Protection Bureau, 591 U.S. ___ (2020)
- CFPB Statement of Policy Regarding Prohibition on Abusive Acts or Practices (Jan. 24, 2020)
- Consumer Federation of America, Dormant: The Consumer Financial Protection Bureau’s Law Enforcement Program in Decline (Mar. 12, 2019)
- Consumer Complaints to the CFPB are Skyrocketing as the Coronavirus Outbreak Continues (MarketWatch, Jul. 19 2020)
- CFPB Complaint Bulletin, Complaints mentioning coronavirus keywords (Jul. 2020)
- Bureau of Consumer Financial Protection, Ability to Repay and QM Rule Assessment Report (Jan. 2019)
- CFPB, QM Definition Under TILA (Regulation Z)-Extension of Sunset Date (Jun. 22, 2020)
- CFPB, QM Definition Under the TILA Regulation Z- General QM Loan Definition (Jun. 22, 2020)
- MillionAcres, What Is the QM Patch, and What Does It Mean for Mortgages? (Feb. 3, 2020)
- Lusnak v. Bank of Am., NA, 883 F.3d 1185, 1193-94 (9th Cir. 2018)
5.3. Consumer Financial Products and Services
- Department of Education, New Methodology for Providing Student Loan Relief to Borrower Defense Applicants (Dec. 2019)
- Elizabeth Warren, Universal Free Public College and Cancellation of Student Loan Debt (April 2019)
- Consumer Financial Protection Bureau, What You Need to Know About Student Loans and Coronavirus Pandemic (Apr. 2020)
- NPR, Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending (February 2019)
- Michael S. Barr et al., Consumer Autonomy and Pathways to Portability in Banking and Financial Services (Nov. 2019)
- [Paywall] Ben Miller, The Student Debt Problem Is Worse Than We Imagined (NYT, Aug. 2018)
- CFPB Announces Plan to Issue ANPR on Consumer-Authorized Access to Financial Data (Jul. 2020)
- Presidential Candidate Elizabeth Warren’s Plan to Cancel Student Debt, discussing DOE's authority to cancel student loans
Notices of Proposed Rulemaking on Payday Lending and Prepaid Cards:
- Rescind Provisions (Feb. 6, 2019); Delay Compliance Date (Feb. 6, 2019)
- Payday, Vehicle Title, and Certain High-Cost Installment Loans- Revocation Rule, 12 CFR Part 1041 (Jul. 7, 2020)
- Consumer Financial Protection Bureau Issues Final Rule on Small Dollar Lending (Jul. 2020)
- Rules Concerning Prepaid Accounts Under the Electronic Fund Transfer Act (Regulation E) and the Truth in Lending Act (Regulation Z) (Jul. 2020)
5.4. Comparing Consumer Protection Models Across Sectors
- Lael Brainard, The Community Reinvestment Act: How Can We Preserve What Works and Make it Better? (Mar. 12, 2019)
- Otting testimony (Jan. 2020)
- Community Reinvestment Act Final Rule (2020)
HLS Case Studies for Part V
This set of case studies could be used in connection with Chapter 5.1 to explore cost-benefit analysis at the CFPB:
- HLS Case Study - Cost-Benefit Analysis at the Consumer Financial Protection Bureau - Part 1 - Feb. 2014
- HLS Case Study - Cost-Benefit Analysis at the Consumer Financial Protection Bureau - Part 2 - Feb. 2014
- HLS Case Study - Cost-Benefit Analysis at the Consumer Financial Protection Bureau - Part 3a - Feb. 2014
- HLS Case Study - Cost-Benefit Analysis at the Consumer Financial Protection Bureau - Part 3b - Feb. 2014
- HLS Case Study - Cost-Benefit Analysis at the Consumer Financial Protection Bureau - Part 4 - Feb. 2014
- HLS Case Study - Consumer Financial Protection Bureau - Responding to the PHH Litigation - Aug. 2017 -- This case study could be used in connection with Chapter 5.1 to explore the immediate aftermath of the D.C. Circuit's initial decision in the PHH v. CFPB litigation.
- HLS Case Study – Robo-Advising - April 2020– This case study could be used in connection with Chapter 4.2 to explore the application of traditional broker-dealer regulation to a new robo advisers. Explores legal issues from the perspective of SEC, FINRA, and Treasury Department staff.
- HLS Case Study - Employee Benefits - Emergency Savings Account - April 2020 - A non-profit organization evaluates the merits of and legal considerations relevant to three different initiatives designed to encourage employers to increase the emergency savings of their employees.
- HLS Case Study - Regulating Consumer Permissioned Access to Financial Data - June 2020 - Policy advisers to a presidential campaign consider how to address the rights of consumers to control the sharing of personal financial data with Fintech firms in the face of restrictive practices put in place by many legacy financial firms.
- HLS Case Study - CLOUD Act Enforcement - April 2020 - The U.S. Justice Department looks into data privacy issues when seeking to obtain information from Fintech firms with subsidiaries operating in the European Union and covered by the General Data Protection Regulation (GDPR).
- HLS Case Study - Machine Learning in the Underwriting of Consumer Loans - March 2020 - The CFPB considers how fair lending laws should be applied to Fintech lenders that employ machine learning and other kinds of algorithms to make lending decisions.
6.1. Regulation of Holding Companies
- CFTC, FDIC, Federal Reserve, OCC, SEC Final Rule on Proprietary Trading (Nov. 14, 2019)
- Federal Reserve Final Rule on Control and Divestiture Proceedings (Jan. 30, 2020)
- Volcker 2.1 Covered Funds Final Rule (Jun. 25, 2020)
- Lael Brainard, Statement on Final Rule to Modify the Volcker Rule (Oct. 8, 2019)
- Davis Polk, Volcker Rule Updated Flowcharts (Proprietary Trading) (Covered Funds) (Jul. 14, 2020)
6.2. Regulation of Bank Market Structure and Consolidation
- Jeremy C. Kress, Modernizing Bank Merger Review, 37 Yale Journal on Regulation 435 (2020)
- Federal Reserve System, Order Approving the Merger of Bank Holding Companies, BB&T Corporation
- House Financial Services Committee, The Next Megabank? Examining the Proposed Merger of SunTrust and BB&T (Jul. 24, 2019)
- Bernadette A. Minton, Alvaro G. Taboada, and Rohan G. Williamson, Are Bank Merger Characteristics Important for Local Community Investment? (May 27, 2020)
- Jeanna Smialek and Deborah B. Solomon, A Hedge Fund Bailout Highlights How Regulators Ignored Big Risks (ET, Jul. 2020)
- Thomas P. Vartanian, What do Google, banks and chicken salad have in common? (The Hill, Oct. 24, 2020)
6.3. Regulating Systemic Risk
- GE De-Designation Decision from the FSOC
- Metlife, Inc. v. FSOC, 177 F. Supp.3d 219 (D.D.C. 2016) (overturning MetLife’s designation as a systemically important nonbank financial company)
- Final Tailoring Rules for U.S. Banking Organizations (Daivs Polk, Nov. 21, 2019)
- For an extension of Chapter 6.3’s discussion of systemic risk with an overview of a recent book length treatment of the subject, see Howell E. Jackson, Introduction: Thinking Hard About Systemic Risk, in Systemic Risk in the Financial Sector: Ten Years After the Global Financial Crisis (Douglas W. Arner, et al. eds.) (2019)
- Randal Quarles, “Monetary Policy and Financial Stability” (May 30, 2019)
- FSOC Final Interpretive Guidance – Nonbank Designations (Dec. 30, 2019)
- FSOC Shift to an Activities-Based Approach Signals an Emphasis on the Risks to Financial Stability from Digital Transformation (Daivs Polk, Jan. 15, 2020)
- Jeremy Kress, Patricia McCoy, and Daniel Schwarcz, Regulating Entities and Activities: Complementary Approaches to Nonbank Systemic Risk (Aug. 24, 2018)
- Howell Jackson and Steven Schwarcz, Pandemic and Systemic Financial Risk (Apr. 20, 2020)
6.4. Foreign Banks in the United States and U.S. Banks Abroad
- Federal Reserve Final Rule on Prudential Standards (Nov. 1, 2019)
- FDIC, Federal Reserve, OCC Final Rule on Applicability Thresholds (Nov. 1, 2019)
- Federal Reserve Proposed Guidance and Request for Comments on Resolution Plan Submissions of Certain Foreign-based Covered Companies (Mar. 18, 2020)
- Federal Reserve Proposed Guidance and Extension of Comment Period on Resolution Plan Submissions of Certain Foreign-Based Covered Companies; Extension of Comment Period (Apr. 27, 2020)
- S&C Memo, Regulatory Tailoring for Foreign Banking Organizations (Apr. 23, 2019)
- [Paywall] Ben S. Bernanke, Timothy F. Geithner and Henry M. Paulson Jr., What We Need to Fight the Next Financial Crisis (NYT, Sep. 7, 2018)
- International Banks are Key to American Economic Success (The Hill, Oct. 2, 2018)
HLS Case Studies for Part VI
- HLS Case Study - Wal-Mart and Banking - Aug. 2017 -- Case study could be used in connection with Chapter 6.1 to explore the arguments for and against the separation of banking and commerce.
7.1. Introduction to Payment Systems
- Federal Reserve Faster Payments Proposal: Potential Federal Reserve Actions To Support Interbank Settlement of Faster Payments, Request for Comments (Nov. 15, 2018)
- Comment Letters on the Faster Payments Proposal: TCH, RILA, Visa, Brookings
- Ant Financial package
- Tobias Adrian, “Stablecoins, Central Bank Digital Currencies, and Cross-Border Payments: A New Look at the International Monetary System” (May 14, 2019)
- FS-ISAC press release, Financial Industry Unites to Enhance Data Security, Innovation and Consumer Control
7.2. Examining Critical Issues in Payment Systems
- Ohio v. American Express Co., 138 S.Ct. 2274 (Jun. 25, 2018)
- Jesner et al. v. Arab Bank, 138 S.Ct. 1386 (Apr. 24, 2018)
- Christine Lagarde, “Winds of Change: The Case for New Digital Currency” (Nov. 14, 2018)
- IMF Study, Casting Light on Central Bank Digital Currencies (Nov. 12, 2018)
- TNB USA Inc. v. Federal Reserve Bank of New York - Complaint, Motion to Dismiss
- Federal Reserve Policy Statement on Payment System Risk (Apr. 1, 2019)
- Digital Dollar Foundation, The Digital Dollar Project (May 2020)
- Bank of England, Central Bank Digital Currency: Opportunities, challenges, and design (Mar. 2020)
- Libra White Paper (Apr. 2020)
- Testimony of Morgan Ricks (Jun. 11, 2020)
- Timothy Massad, "Facebook's Libra 2.0: Why You Might Like it Even if We Can't Trust Facebook" (June 22, 2020)
- Morgan Ricks, John Crawford & Lev Menand, "FedAccounts: Digital Dollars" (July 16, 2020)
HLS Case Studies for Part VII
- HLS Case Study – Digital Currencies - June 2020 – This case study could be used in connection with Part VII to explore the issues facing the Federal Reserve Board in consider two different options for issuing a digital currency.
- HLS Case Study - Mobile Payments for the Developing World - May 2020 - The World Bank considers what advice they should give to developing countries interested in developing new mobile payment systems.
- HLS Case Study - Anti-Money Laundering and Blockchain Technology - May 2020 - FinCen staff consider proposals to relax regulatory requirements to allow for the use of distributed ledger technologies to reduce costs and increase efficiency of regulated firms.
8.1. Corporate Governance
- Federal Reserve Supervision and Regulation Report (May 2020)
- Davis Polk Visual Memo, The Federal Reserve’s Large Financial Institution Rating System – Final Rule (Nov. 6, 2018)
- Consent Order, In the Matter of John Stumpf, No. AA-EC-2019-83 (O.C.C. Jan. 22, 2020)
- Consent Order, In the Matter of Carrie Tolstedt, Claudia Russ Anderson, James Strother, David Julian, Paul McLinko, and Wells Fargo Bank, N.A., No. AA-EC-2019-82, No. AA-EC-2019-81, No. AA-EC-2019-70, No. AA-EC-2019-71, No. AA-EC-2019-72 (O.C.C. Jan. 23, 2020)
- Consent Order, In the Matter of Michael Loughlin, No. AA-EC-2019-86 (O.C.C. Dec. 11, 2019)
- Consent Order, In the Matter of Hope Hardison, No. AA-EC-2019-69 (O.C.C. Jan. 17, 2020)
- Consent Order for a Civil Money Penalty, In the Matter of Wells Fargo Bank, N.A., No. AA-EC-2018-16 (O.C.C. Apr. 20, 2018)
- Consent Order, In the Matter of Wells Fargo Bank, N.A., No. 2018-BCFP-0001 (B.C.F.P. Apr. 20, 2018)
- Margaret Tahyar, First Thing We Do, Let’s Exclude All the Lawyers (Business Law Today, Sept. 17, 2019)
- Tom Baxter, The Rise of Risk Management in Financial Institutions and a Potential Unintended Consequence – The Diminution of the Legal Function (Business Law Today, Apr. 2, 2019)
8.2. Supervision and Enforcement
- Lucia v. SEC, 138 S. Ct. 2044, 2050 (Jun. 21, 2018) – Supreme Court decision addressing the constitutionality of the SEC’s appointment of ALJs.
- Committee on Capital Markets Regulation Statement, Enforcement Data for Calendar 2018 (May 9, 2018)
- Committee on Capital Markets Regulation, Rationalizing Enforcement in the U.S. Financial System: Progress Since June 2019 (Nov. 21, 2019)
- Margaret E.Tahyar Testimony, Senate Banking Committee Hearing on Banking Agencies (Apr. 30, 2019)
- Federal Reserve, CFPB, FDIC, NCUA and OCC Issue Statement Reaffirming the Role of Supervisory Guidance (Sept. 11, 2018) press release on role of supervisory guidance
HLS Case Studies for Part VIII
- HLS Case Study - Wells Fargo Corporate Governance - Oct. 2017 -- Case study could be used in connection with Chapters 8.1 and 8.2 to explore the appropriateness of the Federal Reserve's bringing formal enforcement actions against the directors of Wells Fargo.
9.1. Lender of Last Resort
- Board of Governors of the Federal Reserve System, Office of Inspector General. “The Federal Reserve’s Section 13(3) Lending Facilities to Support Overall Market Liquidity: Function, Status, and Risk Management” (Nov. 2010)
- Davis Polk Visual Memo, Main Street Program (Jun. 12, 2020)
- Republication: The 2009 Davis Polk Financial Crisis Manual (Mar. 16, 2020)
- CARES Act for Corporates Deck (when that has been updated)
9.2. Traditional Toolkit for Bank Failures
- Final Guidance for the 2019 Resolution Plans (Feb. 4, 2019)
- FDIC ANPR on IDI Plans (Apr. 22, 2019)
- FDIC Resolution Planning Tailoring Proposal (May 14, 2019)
- S&C Memo, Resolution Planning Requirements (Apr. 29, 2019)
- Resolution Planning Guidance for Eight Large, Complex U.S. Banking Organizations (Jul. 16, 2018)
- Crisis and Response: An FDIC History, 2008-2013 (Nov. 30, 2017)
- FDIC Resolutions Handbook
- FDIC P&A Agreement on WaMu (Sept. 25, 2008)
- FDIC Report, FDIC Resolution Tasks and Approaches: A Comparison of the 1980 to 1994 and 2008 to 2013 Crises (Jul. 2020)
9.3. After the Crisis: From Orderly Liquidation to Bail-In
- Wharton Financial Institutions Center, Briefing Materials: Resolution of Global Systemically Important Financial Institutions Under the Bankruptcy Code
- Treasury Department Report on Orderly Liquidation Authority and Bankruptcy Reform (Feb. 21, 2018)
- Government Accountability Office Report, Financial Company Bankruptcy: Experts Had Mixed Views on Companies’ Controls for Mitigating Obstacles (Nov. 8, 2018)
- John C. Dugan, Addressing the Fundamental Banking Policy Problem of Runs: Effectively Subordinating Large Amounts of Long-Term Debt to Short-Term Debt to End "Too-Big-To-Fail", 22 N.C. Banking Inst. 11 (2018).
- Agencies provide largest firms with information for next resolution plans | Targeted Resolution Plan template letter (Jun. 29, 2020)
- FSB Thematic Peer Review on Bank Resolution Planning (Apr. 29, 2020)
- The Bank of England’s approach to resolution (the Purple Book) (Oct. 2, 2017)
HLS Case Studies for Part IX
- HLS Case Study - Future of Affiliate Transaction Restrictions and the Federal Reserve's Emergency Intervention Authority - Oct. 2017 -- Case study could be used in connection with Chapter 9.3 to explore the authority of federal authorities to intervene in future financial emergencies. Also useful for exploring the authority of federal authorities to waive restrictions of sections 23A and 23B, discussed earlier in Chapter 2.3.
10.1. Introduction to Asset Management and Its Regulation
- U.S. Department of the Treasury, A Financial System That Creates Economic Opportunities: Asset Management and Insurance (Oct. 2017)
10.2. Mutual Funds: Fiduciary Duties and Structural Restraints
- SEC DIM Director Dalia Blass Speech, ICI Mutual Funds and Investment (Mar. 18, 2019)
- SEC Final Rule on Exchange-Traded Funds, 84 Fed. Reg. 57,162 (Dec. 24, 2019)
- [Paywall] ETFs Have Proved Critics Wrong During the Crisis (FT Editorial Board, Apr. 30, 2020)
- SEC Proposed Rule on Use of Derivatives, 85 Fed. Reg. 4,446 (Jan. 24, 2020)
- SEC Proposed Rule on Good Faith Determinations of Fair Value, 85 Fed. Reg. 28,734 (May 13, 2020)
10.3. Mutual Funds: Disclosure and Its Limitations
For an overview of fiduciary duties with respect to mutual funds as well as efforts to distributed functionally similar financial products subject to less onerous regulatory requirements, see Howell E. Jackson, A System of Fiduciary Protections for Mutual Funds, in Fiduciary Obligations of Business (Arthur Laby & Jacob H. Russell, eds.) (Cambridge University Press, forthcoming 2020)
10.4. The Regulation of Retirement Savings
- John Oliver, "Retirement Plans" - Last Week Tonight (Jun. 12, 2016)
- [Paywall] Anne Tergesen and Richard Rubin, House Passes Bill Making Changes to US Retirement System (WSJ, May 23, 2019)
- [Paywall] Laura Saunders, Your Employee Health Plan Could Soon Look Like Your 401(k) (WSJ, Jun. 21, 2019)
- Department of Labor Press Release on Proposal for New Investment Duties with Respect to ESG Investing (June 23, 2020)
10.5. The Regulation of Hedge Funds and Other Private Funds
- Committee on Capital Markets Regulation Report, Expanding Opportunities for Investors and Retirees: Private Equity (Oct. 30, 2018)
- K&L Gates, Private Equity in 401(k) Plans – a Trillion Dollar Opportunity (Jun. 17, 2020)
- A hedge fund bailout highlights how regulators ignored big risks (ET, Jul. 2020)
HLS Case Studies for Part X
- HLS Case Study - Closed-End Fund Regulation - Aug. 2017 -- Case study could be used in connection with Chapter 10.3 to explore the value of disclosures with respect to closed-end funds.
11.1. Overview of Derivatives
- Tim Massad, “It’s Time to Strengthen the Regulation of Crypto-Assets” (Mar. 2019)
- Gary Gensler Testimony, House Committee on Agriculture Hearing on Cryptocurrencies (Jul. 18, 2018)
- BIS Global OTC Derivatives Market Statistics
- [Paywall] Neil Irwin, What the Negative Price of Oil is Telling Us (NYT, Apr. 21, 2020)
- OTC Derivatives Market Reforms: 2019 Progress Report on Implementation, Financial Stability Board (Oct. 5, 2019)
11.2. Derivatives: Market Infrastructure
- SEC Final Rule on Capital, Margin, and Segregation Requirements for Security-Based Swap Dealers and Major Security-Based Swap Participants and Capital and Segregation Requirements for Broker-Dealers (Jun. 21, 2019)
- CFTC Final Rule on DCO General Provisions and Core Principles (Jan. 27, 2020)
- OTC Derivatives Market Reforms: 2019 Progress Report on Implementation (Oct. 15, 2019)
- Capital Markets Union: Agreement on More Robust Supervision of Central Counterparties (Mar. 13, 2019)
11.3. Derivatives: Business Conduct and Market Integrity
- Federal Reserve Vice Chair Quarles Speech, “The Next Stage in the LIBOR Transition” (Jun. 3, 2019)
- Federal Reserve Vice Chair Quarles Speech, Progress on the Transition to Risk-Free Rates (Apr. 10, 2019)
- BPI Blog Post, Why Is LIBOR Being Replaced Rather Than Reformed? (Apr. 2, 2019)
- NY Federal Reserve, Transition from US Dollar LIBOR – Timeline (Jan. 30, 2019)
- Bank of England, Preparing for 2022: What you need to know about LIBOR transition (Nov. 2018)
- Oliver Wyman Report, Time to Switch Rates: LIBOR Transition (Jun. 2019)
- SEC Adopts New Rules and Amendments under Title VII of Dodd-Frank (Sep. 19, 2019)
- SEC Final Rule on Recordkeeping and Reporting Requirements for Security-Based Swap Dealers, Major Security-Based Swap Participants, and Broker-Dealers (Sep. 19, 2019)
- Swaps Regulation Version 2.0: An Assessment of the Current Implementation of Reform and Proposals for Next Steps (Apr. 26, 2018)
- Cross-border Swaps Rule
HLS Case Studies for Part XI
HLS Case Study - Regulating Crypto Assets: Securities and Commodities - April 2020 - An attorney working at the Bipartisan Policy Center explores the regulation of digital assets, attempting to develop a policy position with respect to SEC and CFTC jurisdiction over these products.
- LSTA Blog, CLO Risk Retention Ruling: Analysis From the Trenches (Feb. 15, 2018)
- Loan Syndications and Trading Association v. SEC, 882 F.3d 220 (D.C. Cir. 2018) (a copy of the decision is available here.)
- LSTA Blog, CLO Risk Retention: This is the End…So, What Comes Next? (May 14, 2018)
- King & Spalding Memo, Risk Retention Update: Spring 2018 (Mar. 26, 2018)
- [Paywall] Matt Wirz, Deals Resume in Sale of Risky Loan Funds (WSJ, June 29, 2020)
- [Paywall] Frank Partnoy, The Looming Bank Collapse, (The Atlantic, July/Aug. 2020)
- [Paywall] Brian Chappata, CLOs are not CDOs, Not Even During a Pandemic, (Bloomberg, Jun. 16, 2020)
- Michael Barr, Neel T. Kashkari, Andreas Lehnert, and Phillip Swagel, Crisis Era Housing Programs, in First Responders: Inside the U.S. Strategy for Fighting the 2007-2009 Global Financial Crisis (Ben S. Bernanke, Timothy F. Geithner, Henry M. Paulson eds., Feb. 2020)
12.2. Mortgage Markets and the Government-Sponsored Enterprises
- Collins v. Mnuchin, 896 F.3d 640 (5th Cir, 2018) (a copy of the decision is available here.)
- Davis Polk Blog Post, “Fifth Circuit Holds That FHFA is Unconstitutionally Structured” (Jul. 18, 2018)
- FHFA 2018 Report to Congress, including the Mark Calabria letter (Jun. 11, 2019)
- House Financial Services Subcommittee Hearing, Emerging Threats to Stability: Considering the Systemic Risk of Leveraged Lending (May 13, 2019)
12.3. Money Market Funds
- [Paywall] Colby Smith and Richard Henderson, Investors Spooked by Outbreak Seek Safety in Money Market Funds (FT, Mar. 26, 2020)
- [Paywall] Paul Kiernan, Andrew Ackerman, and Dave Michaels, Why the Fed Had to Backstop Money-Market Funds, Again (WSJ, Mar. 21, 2020)
- For current information on flow of funds into money market funds, see Office of Financial Research U.S. Money Market Fund Monitor
12.4. Short-Term Wholesale Funding
- FSOC 2019 Annual Report
- House Financial Services Subcommittee Hearing, Emerging Threats to Stability: Considering the Systemic Risk of Leveraged Lending (May 13, 2019)
- Jeanna Smialek and Deborah B. Solomon, A Hedge Fund Bailout Highlights How Regulators Ignored Big Risks (ET, Jul. 2020)
- OFR Basis Trades and Treasury Market Illiquidity (Jul. 2020)
HLS Case Studies for Part XII
- HLS Case Study - Asset Securitization after Madden - Aug. 2017 -- Case study could be used in connection with Chapter 12.1 to explore the implications of the Madden decision on asset securitization.
- HLS Case Study on Strategic Options and Legal Risks for Elite ReFi, Inc. June 2020 -- This case study could be used in connection with Chapter 12.1 to explore the implications of the Madden decision for peer to peer lenders and other parties. Approaches the issues from the perspective of a private practitioner.