The Government Updateis issued by the Innovative Payments Association twenty times a year as a service to members. Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA; Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: [email protected].   Join us on Monday, October 27, 2025, at 6:00 PM PST at The Venetian Hotel for an evening of high-level networking with industry leaders and innovators. Enjoy expertly crafted cocktails and gourmet hors d'oeuvres while making meaningful connections that can transform your business. Don't miss out! Our annual Money20/20 reception is rapidly approaching. Time is running out—space is limited and filling fast. Register now to ensure you don't miss this premier networking opportunity. Thank You to Our Sponsor   The IPA is Coming to Atlanta On Wednesday, November 12, 2025, the IPA will be hosting a special briefing and reception for our members and invited guests 3:00 PM - 5:30 pm EST. The briefing will commence at 3:00 PM, followed by a networking reception at 4:00 PM at SKOL Brewing. Light appetizers and refreshments will be provided during the reception. To register for this event please visit: IPA in Atlanta. Thank You to Our Sponsor   2025 Federal Government Shutdown Due to a failure by the House, Senate, and White House to come to an agreement on how to fund the Federal government, at midnight on October 1, 2025, the Federal government shutdown (except for essential staff). At the time of this writing, no deal has been reached on a continuing resolution (CR) to reopen the government. While informal bipartisan conversations have occurred in the Senate, they haven't produced a path forward. Healthcare remains the primary sticking point for the CR. Objections to Affordable Care Act (ACA) policy have triggered two of the last three extended government shutdowns. Twelve years after the first ACA shutdown in 2013, both parties still hold extremely strong convictions about how healthcare should be delivered in America and who should bear its cost. Both sides are confident that public sentiment remains on their side, or at least not overwhelmingly against them, and it's still too early to tell which party will yield first. Republicans and Democrats continue to appeal to their respective political bases in their messaging, neglecting the broad middle. However, significant political pain could emerge this week as the shutdown begins to impact the lives of everyday Americans through additional federal layoffs, furloughs, and airport delays caused by coordinated absences of TSA and air traffic control personnel. The first post-shutdown payday for the military is next week. Additional details will be provided as developments occur. IPA Files Paper Check Fraud Comment On August 20, 2025, the prudential banking regulators, the Federal Reserve Board of Governors, the FDIC, and the OCC’s June 20th Request for Information (RFI) regarding mitigating payment fraud, specifically fraud associated with paper checks. In brief, the IPA’s files comment outlines our support for efforts to increase collaboration among stakeholders to prevent check fraud, we support increased education and outreach efforts to consumers, and we support the continued transition from paper checks to electronic payments. Please note that public comments were due to the prudential banking regulators on September 18th. CFPB’s 1033 Redux The CFPB’s Open Banking Final Rule continues to receive a lot of attention and scrutiny from the CFPB and the payments industry. As we have reported in the past, the Final Rule is currently in effect, and the litigation regarding the future of the Final Rule continues. In a recent Court hearing on July 29th the CFPB requested, and received from the Court, a stay to develop a new rule (or an amendment). The CFPB stated that they would like to have a rule within three weeks. On August 21st the CFPB released its Advanced Notice of Proposed Rulemaking (ANPR) to the Open Banking Rule. The ANPR covers four key issue areas related to the implementation of section 1033 (aka Open Banking provision) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The issues areas where the CFPB seeks public feedback are: the proper understanding of who can serve as a “representative” making a request on behalf of the consumer, the optimal approach to the assessment of fees to defray the costs incurred by a “covered person” in responding to a customer driven request, the threat and cost-benefit pictures for data security associated with section 1033 compliance, and the threat picture for data privacy associated with section 1033 compliance. In response to the ANPR, the IPA has drafted a letter which discusses the definition of “representative,” requests consideration of a fee for data providers, asks for more detail regarding information security, urges the CFPB to consider hosting stakeholder meetings, and additional time for compliance. The public has until October 21, 2025, to file comments with the CFPB. Interchange: Judge Supports Corner Post Over the Fed In early August 2025, Judge Daniel M. Traynor of the US District Court for the District of North Dakota issued an order in Corner Post v. Board of Governors of the Federal Reserve System, which vacated the Federal Reserve’s Regulation II (“the Durbin Amendment”). However, Judge Traynor stayed his decision overturning Regulation II pending a potential appeal from the Federal Reserve. The Federal Reserve has not made a public comment regarding the ruling. The Federal Reserve has until October 6thto file its intent to appeal. Adding layers to an already complicated issue is another similar case to Corner Post, but the outcome was different. In Linney’s Pizza v. the Federal Reserve, U.S. District Judge Gregory Van Tatenhove in the federal court in Frankfort, Kentucky, found the Fed had justified the regulation, which sets a debit fee cap at 21 cents per transaction. The decision was a loss for Frankfort restaurant Linney’s Pizza, which sued in 2022. If you have any questions, please contact Brian Tate ([email protected]). Hill Nominated to be Chair of the FDIC Last week it was widely reported that the current Interim Chairman of the FDIC, Travis Hill, will be nominated to be the full time Chairman of the deposit insurance regulator. Hill, who has already been Senate confirmed for prior positions, will once again go through the Senate confirmation process. The Interim Chair has previously worked at the FDIC from 2018 to 2022, as Deputy to the Chairman for Policy and, before that, as Senior Advisor to the Chairman. In these roles, among other responsibilities, he oversaw and coordinated regulatory and policy initiatives at the agency and advised the Chairman on regulatory and policy matters. Prior to joining the FDIC, Mr. Hill served as Senior Counsel at the United States Senate Committee on Banking, Housing, and Urban Affairs, where he worked from 2013 to 2018. In this role, he participated extensively in the drafting and negotiating of numerous bipartisan bills. Before working at the Senate, Mr. Hill worked as a policy analyst at Regions Financial Corporation from 2011 to 2013. Bisignano to be IRS Commissioner While Leading SSA On October 6, 2025, U.S. Secretary of the Treasury and Acting Commissioner of the Internal Revenue Service Scott Bessent announced that Commissioner of the Social Security Administration Frank Bisignano will serve as Chief Executive Officer (CEO) of the IRS. In this newly created position, Mr. Bisignano will report directly to Acting Commissioner Bessent, managing the organization and overseeing all day-to-day IRS operations while also continuing to serve in his role as Commissioner of the Social Security Administration. Bisignano, the 18th Senate-confirmed Commissioner of the U.S. Social Security Administration, previously served as Chairman and CEO of Fiserv, the world’s largest financial services and payment technology company. Fed to Host Payments Conference The Federal Reserve of Governors has posted on their website that they plan to conduct a Payments Innovation Conference on October 21, 2025. While the public is invited to participate remotely online, not much is publicly known about the conference itself, including the agenda, speakers, or general attendees. The IPA plans to participate remotely, but in the interim, if additional details become public, the IPA will share them with our members. OCC to Reduce Regulatory Burden for Community Banks. In two bulletins, the OCC clarified examination procedures for community banks. The OCC announced it is removing fixed examination requirements for community banks and instead tailoring the examination scope and frequency to be consistent with risk-based supervision. In a separate bulletin, the OCC clarified its expectations that community banks should tailor model risk management practices commensurate with the bank’s risk exposures, its business activities, and the complexity and extent of its model use. The OCC is also considering additional steps to enhance flexibility and reduce burden related to model risk management. This bulletin is just the first step in refining model risk management guidance for all of the OCC’s regulated institutions. The OCC also requested comments on two proposed rules. The OCC proposed rescinding its Fair Housing Home Loan Data System regulation, removing largely duplicative data collection requirements for national banks. The proposal would eliminate regulatory burden for banks without having a material impact on the availability of data necessary for the OCC to conduct its fair housing-related supervisory activities. The OCC also proposed broadening eligibility for expedited or reduced licensing procedures to community banks. Related Links
Grassley Letter on Class Action Payouts U.S. Senate Chuck Grassley (R-IA), Chairman of the Senate Judiciary Committee, addressed a letter to John G. Roberts, Jr., Chief Justice, Supreme Court of the United States, regarding the companies selected by federal courts to handle the class action settlement process. According to the Chairman, these companies are receiving “kickbacks” from certain fintech firms who have been hired by federal courts to distribute class action settlement payouts. Further, Sen. Grassley’s letter raises concerns that there appears to be very little oversight by the federal courts on Claims Administrators using digital prepaid cards to facilitate class action settlement payouts. In brief, Grassley asks the Chief Justice a set of questions that appear to be designed to learn more about the Chief Justice’s oversight of class action settlements.  IPA Mentions/Podcasts/Reports:
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