The Regulatory Week in Review: October 7, 2016
IN THE NEWS
- The Consumer Financial Protection Bureau (CFPB) issued a final rule for prepaid cards that aims to provide users of prepaid cards with the same protections as users of traditional debit cards by requiring that companies, who have three months to comply with the rule, provide both short form and long form disclosures—which are intended to assist customers in understanding the terms of an account prior to opening one—as well as requiring that customers be given at least 21 days to repay debt before charging late fees.
- The Securities and Exchange Commission (SEC) announced that Credit Suisse AG agreed to pay a $90 million fine to settle charges that it misrepresented the methodology it used to determine an important wealth management performance metric. In disclosures, Credit Suisse claimed it individually assessed each client’s assets in determining net new assets, but the SEC said an investigation it conducted found that Credit Suisse sometimes used “an undisclosed results-driven approach” to determine net new assets.
- In a second major development for international climate policy this week, the International Civil Aviation Organization (ICAO) adopted an agreement among its 191 member countries, including the United States, to limit carbon dioxide emissions from international airline flights by adopting a market-based policy that will require airlines to purchase offset credits for every increase in emissions beginning in the year 2020—a policy that members of the environmental community call a “good first step” towards curbing carbon emission from airlines and which was applauded by U.S. airline industry.
- The U.S. Department of Energy (DOE) released a final rule that will increase efficiency standards for certain “miscellaneous refrigeration products”—most notably, wine chillers and “combination” products such as chiller-freezers or chiller-refrigerators—and which the DOE stated could result in a reduction of up to 58 percent in energy use and reduce greenhouse gas emissions by an amount “equivalent to the emissions resulting from the annual electricity use of more than 2.8 million homes.”
- The Office of Federal Contract Compliance Programs (OFCCP) at the U.S. Department of Labor (DOL) announced that Tyson Foods, Inc. agreed to pay a $1.6 million settlement stemming from allegations of discriminatory hiring practices at six locations in Texas, New Mexico, and Arkansas. Lola Hithon, Tyson’s Vice President for Employment Compliance, reportedly stated that the company was “disappointed” with the OFCCP’s allegations and that the company works “hard to comply with all hiring laws and to treat all job applicants fairly,” but the OFCCP alleged that its investigation had uncovered evidence of discrimination “on the bases of sex, race and/or ethnicity.”
WHAT WE’RE READING THIS WEEK
- A new report from the U.S. Government Accountability Office (GAO) assessed the “resources the federal government devotes to public relations,” including by making information about regulations available to the public. The GAO found that over the past decade, total federal spending on public relations has averaged about $1 billion annually, with ten agencies accounting for roughly 95 percent of spending. The report also noted that “[t]he combined salary amounts for federal public relations employees averaged approximately $430 million from fiscal year 2006 through 2014.” Overall, the U.S. Department of Defense (DoD) had the largest public relations staff, and also accounted for the majority of spending on “advertising and public relations contracts.”
- In an essay for The Hill, Adonis Hoffman said that Federal Communications Commission (FCC) Chairman Tom Wheeler’s decision to postpone voting on the FCC’s set-top box proposal might have been “one of his most prudent.” Hoffman, a former chief of staff and senior legal advisor to FCC Commissioner Mignon Clyburn, argued that the FCC has not been transparent about the development of the proposal, and urged Chairman Wheeler to use the delay as an opportunity to release the current draft of the proposal for public review.
- A report released by the U.S. Department of Labor (DOL) examined the efficacy of state-based workers’ compensation programs, and concluded that “the current situation warrants a significant change in approach in order to address the inadequacies of the systems.” Among other policy recommendations, the report recommends that the DOL explore the possibility of establishing “standards that would trigger increased federal oversight if workers’ compensation programs fail to meet those standards.”