Finance

New York AG announces bill to protect consumers after Trump hobbles CFPB

Published

3 months ago

March 13, 2025

NY Attorney General Letitia James speaks during a press conference at the offices of the Attorney General on January 08, 2025 in New York City.

Michael M. Santiago | Getty Images

New York Attorney General Letitia James on Thursday announced a bill to protect the state’s consumers and small businesses from scams and deceptive practices from lenders, debt collectors and health care firms.

James said in a release that the legislation would bolster the state’s existing consumer protection law —which dates from 1970 and is more limited in scope — at a time when the Trump administration has hobbled the federal agency charged with that task.

The new bill, called the Fostering Affordability and Integrity through Reasonable Business Act, is supported by state lawmakers Senator Leroy Comrie and Assemblymember Micah Lasher, according to James.

“In New York right now, companies can make canceling a subscription so hard it seems impossible; nursing homeowners can sue relatives of deceased former residents; and debt collectors can steal social security benefits,” James said. “The FAIR Business Practices Act will close loopholes that make it too easy for New Yorkers to be scammed and will allow my office to go after anyone who violates the law.”

The New York bill is one of the first examples of state officials attempting to fill the vacuum left by the hobbling of the federal Consumer Financial Protection Bureau.

Since taking over as Acting Director of the CFPB last month, Russell Vought has fired about 200 employees and told the rest to stop nearly all work. Vought and Elon Musk‘s Department of Government Efficiency planned to fire nearly all the agency’s workers, according to testimony from current employees, but was stopped by a federal judge.

It’s unclear what will ultimately happen to the agency. But so long as the CFPB is frozen, consumers will have to rely on their state AGs and regulators when they have complaints.

James said the law will stop auto lenders as well as mortgage and student loan servicers from steering consumers into high-cost loans, will reduce so-called junk fees, tamp down on shady practices at car dealerships, and prevent firms from taking advantage of those who don’t speak English.

The effort drew support from two key regulators from former President Joe Biden’s administration, ex-CFPB director Rohit Chopra and former FTC Chair Lina Khan.

“We need stronger state laws to combat abuses that harm families and honest businesses,” Chopra said in a statement.

“By passing a strong consumer protection bill, New York lawmakers can empower Attorney General James to fully defend New Yorkers’ pocketbooks, privacy, and economic freedoms,” Khan said.

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Finance

Swiss government proposes tough new capital rules in major blow to UBS

Published

2 days ago

June 6, 2025

Business Finance News

A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.

Fabrice Coffrini | AFP | Getty Images

The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.

The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.

“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.

The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.

“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.

‘Too big to fail’

UBS has been battling the specter of tighter capital rules since acquiring the country’s second-largest bank at a cut-price following years of strategic errors, mismanagement and scandals at Credit Suisse.

The shock demise of the banking giant also brought Swiss financial regulator FINMA under fire for its perceived scarce supervision of the bank and the ultimate timing of its intervention.

Swiss regulators argue that UBS must have stronger capital requirements to safeguard the national economy and financial system, given the bank’s balance topped $1.7 trillion in 2023, roughly double the projected Swiss economic output of last year. UBS insists it is not “too big to fail” and that the additional capital requirements — set to drain its cash liquidity — will impact the bank’s competitiveness.

At the heart of the standoff are pressing concerns over UBS’ ability to buffer any prospective losses at its foreign units, where it has, until now, had the duty to back 60% of capital with capital at the parent bank.

Higher capital requirements can whittle down a bank’s balance sheet and credit supply by bolstering a lender’s funding costs and choking off their willingness to lend — as well as waning their appetite for risk. For shareholders, of note will be the potential impact on discretionary funds available for distribution, including dividends, share buybacks and bonus payments.

“While winding down Credit Suisse’s legacy businesses should free up capital and reduce costs for UBS, much of these gains could be absorbed by stricter regulatory demands,” Johann Scholtz, senior equity analyst at Morningstar, said in a note preceding the FINMA announcement.

“Such measures may place UBS’s capital requirements well above those faced by rivals in the United States, putting pressure on returns and reducing prospects for narrowing its long-term valuation gap. Even its long-standing premium rating relative to the European banking sector has recently evaporated.”