Key Takeaways from the UK Financial Conduct Authority’s Revised Enforcement Guide
Following a two-part consultation, which began in February 2024 (i.e., CP 24/2 and CP 24/2: Part 2) and was accompanied by a Policy Statement (PS25/5) setting out the UK Financial Conduct Authority’s (FCA) consultation response, the FCA has revised its Enforcement Guide (now referred to in the FCA Handbook as ENFG).
This is of particular interest to all firms that are regulated by the FCA and individuals working within such firms, consumers and investor groups, industry groups, trade bodies, advisers, experts and commentators.
Key Takeaways
A Revised Policy on Publicising Investigations
In acknowledging the widespread concern and significant criticism during the previous consultation, the FCA has abandoned its proposal to name regulated firms under investigation based on a wide and subjective “public interest” test. This is near to a complete reversal of the FCA’s proposed policy first announced in the FCA’s letter to the Treasury Select Committee in March 2025.
However, the FCA’s ENFG continues to enforce the pre-existing “exceptional circumstance test”, albeit with three new limited circumstances in which investigations may be announced. This will enable the FCA to:
Announce and Name the Subjects of Investigations
The FCA will only announce the name of subjects of ongoing investigations into suspected unauthorised activity or criminal offences related to unregulated activity if the FCA considers an announcement desirable to warn or alert consumers or investors, or to help the investigation itself, for instance, by bringing forward witnesses.
Reactively Confirm the Subject and Nature of an Investigation
ENFG gives the FCA the ability to confirm the actions the FCA is taking if the investigation has become part of the public domain due to an associated firm or a regulatory, government or public body making the investigation public.
Anonymised Announcements
The FCA will consider making public that it is investigating a particular matter without naming or otherwise identifying the subject of the investigation where it is desirable for the purpose of educating people as to the types of conduct the FCA is investigating or to encourage firms to comply with the rules or other requirements set by the FCA.
The Impact
In practice, these publicity policy changes will directly affect only firms engaging in unauthorised activity, as unauthorised firms or authorised firms carrying out unauthorised business may now find themselves in the headlines when investigated.
A wider impact is likely to be an increase in anonymised investigation announcements designed to serve as a deterrent or for educational purpose. It will be important for firms and individuals to pay close attention to these announcements and record any assessments and consequential changes.
Accepting Reports on a Limited Waiver Basis
The ENFG seeks to clarify (rather than amend) the FCA’s approach to legally privileged materials disclosed by firms. The FCA will accept disclosure on a limited waiver basis.
However, the FCA will not:
Agree the fact or extent to which they are legally privileged, or
Accept any condition or stipulation that purports to restrict the FCA’s ability to use the information in exercising its statutory functions (e.g., a requirement that the report be used only for the purposes of supervision and not enforcement).
The Impact
Whilst the FCA states specifically there is no obligation to share legally privileged material with the FCA and that it does not consider that the ENFG undermines a firm’s ability to resist disclosure of a report to a third party, the FCA’s approach will almost inevitably lead to increased pressure on firms to disclose such materials to the FCA.
It should be noted that the FCA has statutory restrictions on the disclosure of confidential information, which if breached, constitutes a criminal offence. These restrictions will continue to be in place.
Discretion to Prevent Lawyers Attending Compelling Interviews
Despite the respondents to the two-part consultation pushing back on this amendment to the policy, the FCA has decided that it will seek to exercise what it believes is its discretion to refuse permission where the FCA determines that a legal adviser’s attendance may create a potential conflict of interest or otherwise prejudice any FCA investigation. It is clear from the ENFG that one of the situations the FCA has in mind is where the lawyer owes a duty of disclosure to another person (e.g., an interviewee’s employer). The FCA has further clarified that the determination as to whether such concerns arise rests solely with the FCA. However, the policy statement suggests this use of discretion by the FCA will be a rare occurrence.
The Impact
The FCA is seeking to regularise what it considers to be its existing approach—the regulator has increasingly pushed back on joint legal advisers’ attendance at interviews. This has resulted in many firms being accustomed to providing for employees to have independent legal counsel ahead of compelled interviews and making appropriate arrangements for joint or common-interest privilege. However, there is potential for significant conflict between the FCA and legal representatives given that legal advisers have their own professional duties to manage conflicts of interest.
Optional Scoping Meetings and Additional Decision-Makers
Scoping meetings will now be subject to a case-by-case assessment. These initial meetings have sometimes offered a valuable opportunity to ask questions, clarify points and address the areas of the upcoming investigation. However, over time, they have become less useful given the inability or unwillingness of FCA enforcement teams to provide any such answers or additional information. The FCA’s intention appears to be to always have a scoping meeting where the subject requests or indicates they would like to have one. However, the FCA has stated that it will remain flexible when firms who have already had extensive discussions with the FCA do not wish to have a scoping meeting.
Further, the FCA has expanded which senior personnel can decide on whether to start civil and criminal enforcement proceedings. Whilst previously limited to executive directors, now directors in enforcement will also have that power.
The Impact
The flexible approach to scoping meetings and the extension of powers to directors in enforcement is hopefully an indication that the FCA has listened to the long-standing criticism of its approach to those subject to investigation and the speed of its decision-making.
No More Private Warnings, Preliminary Investigation Reports or Preliminary Findings Letters
The FCA has deleted previous references included in the original Enforcement Guide (EG), the precursor to ENFG, to private warnings and confirmed that, having not used them for some time, they will not be used as an enforcement tool in the future. Instead, the FCA will raise the issues with the firm or individual in direct communications.
The FCA stated that it has trimmed over 250 pages from the EG in the process, removing content that was duplicative or outdated.
The Impact
The removal of private warnings demonstrates the FCA’s preference for formal enforcement outcomes as a means of deterrence. This can be further evidenced by the fact that the FCA has confirmed that it now has fewer open investigations, with the number having fallen by over 35% since April 2023, and investigations are reaching outcomes more quickly, according to the FCA’s data. This appears to be a double-edged sword for firms in that they are less likely to be investigated but more likely to face an outcome if they are (with increased public attention).
Conclusion
Whilst the FCA states that it is committed to transparency, it is questionable how impactful the new ENFG will be given that many if the changes appear to simply be a reflection of either powers the FCA already had (but weren’t necessarily using) or the approach it has already been taking. We can only wait and see if any of the changes made have a material impact on those who find themselves under scrutiny by FCA enforcement.
Cutting Red Tape and Supporting Growth: the EU’s Omnibus IV Simplification Package on Small Mid-Cap Companies
On 21 May 2025, the European Commission published a new Omnibus IV Simplification Package, a targeted legislative initiative designed to alleviate regulatory burdens and enhance proportionality for smaller businesses.
Central to this recalibrated framework is the introduction of a new category of undertakings, i.e., Small Mid-Cap companies (SMCs).
Defined in Commission Recommendation C(2025) 3500, SMCs are:
companies that do not qualify as SMEs under Recommendation 2003/361/EC;
employ fewer than 750 persons, and
have either an annual turnover not exceeding €150 million or an annual balance sheet total not exceeding €129 million.
Moreover, the proposal for a Directive amending MiFID II also introduces the concept of SMCs for the purposes of capital markets regulation. It defines SMCs in that specific context as listed companies with an average market capitalisation between €200,000 and €1 billion, based on end-of-year stock prices over the preceding three calendar years. The objective is to improve access to capital markets for companies that have historically been underserved by EU-level simplification efforts.
The proposed amendment to Directive (EU) 2022/2557, also parts of the package, concerns the resilience of critical entities and incorporates the SMC definition to qualify some entities that may benefit from certain exemptions or adjusted obligations.
Another legislative proposal within the package introduces targeted amendments to the following six Regulations to introduce adjustments for SMCs:
Regulation (EU) 2016/679 (General Data Protection Regulation, GDPR)
Regulation (EU) 2016/1036 on protection against dumped imports
Regulation (EU) 2016/1037 on protection against subsidised imports
Regulation (EU) 2017/1129 (Prospectus Regulation)
Regulation (EU) 2023/1542 (Batteries Regulation)
Regulation (EU) 2024/573 (F-gas Regulation)
These amendments seek to introduce simplification and proportionality measures, previously reserved for SMEs, to the newly recognised SMC category. For instance, under the GDPR, SMCs will be exempt from maintaining data processing records where the risk to individuals’ rights is considered low. In the field of trade defence, the revised Regulations offer simplified procedural access for SMCs to anti-dumping and anti-subsidy investigations, supported by a dedicated helpdesk and alignment of procedural timelines with the financial year of the undertaking concerned.
The Batteries Regulation is also affected. In addition to a reduction in reporting obligations for SMCs, from an annual to a triennial cycle, introduced as part of the legislative proposal mentioned above, the Commission has also put forward a separate, ad hoc proposal to postpone the application of due diligence obligations under the Regulation by two years. This extension pushes the compliance deadline to August 2027.
The package also advances the EU’s objective of digitalising regulatory processes. This is pursued through a Proposal for a Directive and a corresponding Proposal for a Regulation, both aimed at eliminating outdated paper-based requirements in product compliance legislation. Among other measures, the proposals provide for the digitalisation of Declarations of Conformity, the option to supply instructions for use in electronic format (subject to certain safeguards), mandatory online contact points for manufacturers, and the integration of compliance data into Digital Product Passports where applicable. Compliance documentation will also be submitted electronically to national authorities, streamlining procedures while maintaining consumer protection and product safety.
Another significant innovation concerns the introduction of Common Specifications (CS) as an alternative means of demonstrating compliance in situations where harmonised standards are unavailable, delayed, or insufficient. While CS are already used in the medical device sector, they are now expected to play a broader role, including under forthcoming legislation such as the AI Act and the Cyber Resilience Act. To support this development, the Commission has launched a public consultation on CS, which is open until 28 July 2025.
What This Means for Business
The Omnibus IV Package sends a clear signal that the EU recognises the disproportionate regulatory burden faced by mid-sized businesses. By embedding proportionality more systematically across key legislative acts, the Commission enables companies, particularly those classified as SMCs, to benefit from greater legal certainty, administrative relief, and digital efficiencies.
For businesses active at the intersection of sustainability, product regulation, and digital innovation, the Omnibus IV reforms offer both relief and strategic opportunity.
Payment Proccessor to Pay Millions to Settle FTC Allegations of Unfair Payment-Processing Practices and Facilitation of Deceptive Tech-Support Schemes
On June 16, 2025 the Federal Trade Commission announced that U.K.-based payment processor, Paddle.com Market Limited, and its subsidiary, Paddle.com, Inc., will pay $5 million and be permanently banned from processing payments for tech-support telemarketers. The foregoing is in settlemetn of a Federal Trade Commission action alleging that Paddle abused the U.S. credit-card system and enabled deceptive foreign operators to access it, costing consumers millions of dollars.
According to the complaint, the FTC alleged that Paddle and its subsidiary processed payments for deceptive tech-support schemes that targeted U.S. consumers including older adults.
“Paddle provided foreign-based tech-support schemes with access to the U.S. payment system, allowing these companies to harm consumers,” said FTC lawyer Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection. “The FTC will hold accountable payment companies that knowingly facilitate payments for scammers or look the other way when faced with red flags about their clients’ conduct.”
The complaint charges that: (i) Paddle allegedly opened merchant accounts claiming to be a “merchant of record” or software “reseller,” then allegedly used these accounts to process card payments on behalf of numerous, unrelated third-party merchants; (ii) Paddle allegedly enabled overseas schemes to access the credit card system and collect payments from U.S. consumers, and to allegedly evade detection by merchant banks and card networks; (iii) Paddle allegedly facilitated schemes, like Restoro-Reimage, that allegedly used fake virus alerts and pop-up messages to impersonate familiar brands, such as Microsoft or McAfee (in March 2024, Paddle’s client, Restoro-Reimage, paid $26 million to settle the FTC’s charges of violating the FTC Act and the Telemarketing Sales Rule); and (iv) as the “merchant of record,” Paddle alleedly charged consumers for automatically renewing subscriptions without clearly disclosing that consumers would incur recurring charges.
According to the FTC, Paddle allegedly violated the FTC Act, the Telemarketing Sales Rule, and the Restore Online Shoppers’ Confidence Act.
Under the proposed settlement order Paddle will be:
Permanently prohibited from processing payments for tech-support merchants that engage in telemarketing or use pop-up messages about computer security or performance;
Prohibited from assisting deceptive merchants or engaging in any tactic to avoid fraud or risk-monitoring programs established by banks or the card networks;
Required to implement effective client screening and monitoring, and provide periodic reporting about merchant-clients’ transactions to Paddle’s payment-service providers; and
Required to clearly and conspicuously disclose the terms of any subscription it processes, get consumers’ express informed consent to the subscription, and provide consumers with a simple way to cancel and prevent recurring charges.
According to the FTC, the $5 million payment Paddle is required to make under the settlement will be used to supplement the redress for consumers purportedly harmed by the alleged Restoro-Reimage tech support scheme.
Contact an experienced FTC CID lawyer if you or your company have received an FTC civil investigative demand or if you are are interested in discussing the implementaion of protactive compliance protocols.
Chairman Andrew N. Ferguson issued a statement joined by Commissioners Melissa Holyoak and Mark R. Meador.
“One way the Commission combats foreign scams, however, is enforcing the law against American companies who unlawfully facilitate foreign schemes. By vigorously requiring domestic actors to obey the law, the Commission can cut off foreign scammers’ use of American companies to prey on American families. Today’s settlement is an example of such a case. Paddle, though primarily based in the United Kingdom, has a continuing presence in the United States, with an American component through which it channels American payments.”
The FTC filed the complaint and proposed settlement order in the U.S. District Court for the District of Columbia.
CFPB and DOJ Terminate Another Redlining Consent Order
On June 2, the U.S. District Court for the Eastern District of Pennsylvania terminated a 2022 consent order and dismissed with prejudice the CFPB and DOJ’s redlining lawsuit against a nonbank mortgage lender. The motion to terminate the consent order, filed jointly by the CFPB and DOJ, asserted that the company had fulfilled its monetary and injunctive obligations under the order.
The underlying complaint alleged that the lender violated the Equal Credit Opportunity Act (ECOA), Regulation B, the Consumer Financial Protection Act (CFPA), and the Fair Housing Act (FHA) by redlining majority-minority neighborhoods in the Philadelphia metropolitan area between 2015 and 2019. The complaint alleged that the company maintained nearly all offices in majority-white neighborhoods, failed to market to communities of color, and discouraged prospective applicants on the basis of race, color, or national origin.
The 2022 consent order imposed a range of remedial measures, including funding an $18.4 million loan subsidy program, establishing a community development partnership program and a consumer financial education program, implementing targeted advertising and outreach to improve credit access to underserved communities, and pay a $4 million civil money penalty to the CFPB.
Putting It Into Practice: The termination of this consent order continues the trend of federal agencies dropping redlining enforcement actions initiated under prior leadership (previously discussed here and here). While lenders should continue to monitor for discriminatory effects in their credit operations, particularly around physical branch locations, servicing areas, and marketing efforts, this latest development suggests that federal agencies are becoming less likely to pursue redlining cases based primarily on statistical gaps alone.
Listen to this post
New York AG Secures $250,000 Settlement with Money Transmitter Over Remittance Rule Violations
On June 13, Judge Katherine Polk Failla of the U.S. District Court for the Southern District of New York entered a stipulated final judgement resolving claims brought by the New York Attorney General against a global money transmitter. The lawsuit, initially filed in partnership with the CFPB (previously discussed here), alleged violations of the Electronic Fund Transfer Act (EFTA), including the Remittance Rule under Regulation E, as well as the Consumer Financial Protection Act (CFPA).
The court’s order follows the CFPB’s recent withdrawal from the case in April (previously discussed here), after which the New York AG continued pursuing claims under New York state law. The original complaint filed jointly by the Bureau and the New York Attorney General alleged the following:
Inaccurate availability disclosures. The company allegedly failed to accurately disclose the date on which funds would be available to recipients, contrary to the requirements of the Remittance Rule.
Deficient error resolution. The company purportedly failed to promptly investigate consumer complaints, issue required fee refunds, or provide mandated explanations and documentation within the regulatory timeframes.
Noncompliant internal procedures. Regulators alleged the company lacked adequate written policies to identify covered errors, ensure timely investigations, and retain necessary compliance documentation.
Unfair acts and practices. The company was accused of unnecessarily delaying remittance transfers and refunds after completing internal screenings, depriving consumers of timely access to funds.
The stipulated final judgement requires the company to improve its compliance-management systems, enhance employee training, and ensure that its disclosures and error-resolution procedures align with federal law. The company must also provide compliance documentation to the New York Attorney General upon request for a three-year period.
Putting It Into Practice: The final judgement reflects how state regulators are taking the lead in consumer protection as the CFPB scales back its involvement in legacy enforcement actions (previously discussed here and here). While federal enforcement activity may be narrowing, state regulators like the New York AG continue to be active and aggressive.
Listen to this article
Texas Supreme Court Issues New Interpretation of Texas Usury Law
On May 23, the Texas Supreme Court issued an opinion holding that in determining whether a commercial loan is usurious under Texas state law, the “actuarial method” must be employed. This requires the applicable amount of interest to be calculated using the loan’s declining principal balance on a monthly basis, rather than always using the original principal balance of the loan. This decision was in response to a question posed to the 5th Circuit Court of Appeals regarding a dispute over usurious interest charges.
Prior to 1997, there had been no reference to the actuarial method in the Texas usury statute, but the law was amended in 1997 to require use of the actuarial method in determining the amount of interest that could be assessed without violating the law. The Texas Supreme Court also pointed out that a loan is not deemed usurious when the interest exceeds the maximum amount allowed by law (28 percent per year for commercial loans in Texas), but instead when the loan’s interest is spread out over the contract’s entire term. This would allocate the total interest provided for a loan agreement over the loan’s full term. In this case, the difference between the permissible interest using the interpretation urged by the defendant lender over the life of the loan and the interpretation urged by the plaintiff borrower (ultimately accepted by the court) was over $100,000.
Putting It Into Practice: Commercial lenders in Texas should follow the statute and use the actuarial method to calculate the amount of interest the lender is permitted to collect over the life of the loan without the loan being deemed usurious. While the actuarial method is not defined in the Texas Finance Code, it does have a common definition provided by the Texas Banking Department and in the federal Truth in Lending Act, as well as by Black’s Law Dictionary.
Listen to this post
CFPB Proposes to Eliminate Education Allocations from Civil Penalty Fund
On June 18, the CFPB published a proposed rule that would rescind its authority to use money from the Civil Penalty Fund for consumer education and financial literacy initiatives. The proposed changes would amend the CFPB’s 2013 rule implementing the Civil Penalty Fund provisions of the Consumer Financial Protection Act (CFPA) and restrict the Fund’s use exclusively to harmed consumers.
The Civil Penalty Fund, created by Section 1017(d) of the CFPA, pools civil money penalties collected in CFPB enforcement actions. While the statute allows the Bureau to use remaining funds for consumer education “to the extent victims cannot be located or such payments are otherwise not practicable,” the new proposal would strip all such references from the implementing rule and eliminate the mechanism entirely.
Notably, the CFPB has used this discretionary authority rarely, allocating $28.8 million for consumer education since its inception, compared to $3.6 billion it has disbursed to harmed consumers.
Putting It Into Practice: The move is in line with the CFPB’s April 2025 internal memorandum where Chief Legal Officer Mark Paoletta stated that the Bureau “will focus on redressing tangible harm by getting money back directly to consumers, rather than imposing penalties on companies in order to simply fill the Bureau’s penalty fund.” (See our previous discussion here). Given the CFPB has only used its discretionary authority rarely, we expect it to have little impact on the Bureau’s overall operations.
Listen to this post
NYC Comptroller Report Calls for Overhaul of State Consumer Financial Protections
On June 9, 2025, New York City Comptroller Brad Lander released a report urging City and State leaders to modernize consumer financial protections. The report outlines a series of legislative and regulatory recommendations aimed at closing gaps in existing protections and addressing emerging risks in the consumer financial marketplace.
The report comes amid a major regulatory pullback in the federal sector, highlighted by the CFPB’s layoffs and stalled enforcement posture (previously discussed here and here). The Comptroller identified five priority areas where local and state lawmakers could intervene to strengthen consumer safeguards. These include:
Addressing enforcement and regulatory gaps. The report criticizes New York’s current consumer protection law, General Business Law § 349, as one of the weakest in the country and calls for enactment of the FAIR Business Practices Act. The Act, which is currently in the New York legislature and is championed by New York Attorney General Letitia James, would broaden the scope of prohibited business practices beyond “deceptive” acts and practices and also include those acts that are “unfair” or “abusive.”
Expanding access to affordable banking. Among other steps, the report supports adoption of NYDFS’s proposed overdraft fee limits and broader access to IDNYC-validated accounts (which are New York City ID cards) at state-chartered banks.
Regulating emerging financial products. The Comptroller supports passage of the End Loansharking Act, which would bring earned wage access products, rent-to-own contracts, and merchant cash advances under state lending laws and prohibit predatory practices.
Enhancing privacy rights. The report calls for consumer data rights similar to those in California and Oregon, including the right to access, correct, and delete personal information.
Improving transparency and consumer outreach. The report recommends a statewide or city-level public complaint database to enhance oversight, especially if the CFPB’s complaint database is weakened or disabled.
Putting It Into Practice: States are increasingly stepping in to expand consumer financial protections as federal oversight recedes (previously discussed here). Financial services companies operating in New York and other progressive jurisdictions should anticipate additional legislative and regulatory activity and reassess their compliance obligations accordingly.
Listen to this post
Build Up, Spend Down, and the Power of Family Philanthropy Engagement
Private Foundations (PFs) and endowments tend to get lumped together into a tidy package of tax efficiency that grows into perpetuity. But there’s more to them than that.
Perpetuity
Most foundations are either static or dynamic. Static foundations tend to form after a single liquidity event and fund grants from interest. Dynamic foundations, often generations old, grow from regular infusions of funding, sometimes from multiple sources including distributions from charitable trust or the sale of traditional or unusual assets. Either way, most governing bodies run foundations as perpetual entities, distributing the 5% minimum and paying the annual excise tax based on the size of the corpus.
Private Foundation as a Vehicle
Occasionally PFs are used as a vehicle and funded annually from marketable securities or other sources at levels that cover the annual grantmaking and expense budget. The Gates Foundation uses this model. Their corpus sits in a trust that funds the foundation. The trust is designed as an investment vehicle, the “source” of funds, and the PF manages the programming and grantmaking work, or the “use” of funds.
Spend Down Foundations
Some PFs are designed as spend downs, although many of those have long time horizons. Chuck Feeney, the co-founder of Duty-Free Shops, created a stealthy foundation in 1982 called Atlantic Philanthropies. After about 20 years the foundation took on the goal of spending both the endowment and Chuck’s own fortune. In 2020, after distributing more than $8B, Atlantic closed shop. Chuck passed in 2023. The Billionaire Who Wasn’t: How Chuck Feeney Secretly Made and Gave Away a Fortune, by Conor O’Clery, chronicles Feeney’s and Atlantic’s trajectory. “Give While You Live” became a rallying cry to spend down, and put more money into the field now.
The Power of Philanthropy in Families
Scaffolding philanthropic structures to support family collaboration has a remarkable impact on how families evolve. Whether a perpetual foundation is governed by multiple generations and family lines, designed to spend down, or pay out to other endowments operated by community-based organizations, engaging stakeholders in conversations about the design of foundation structure is the blueprint for future success.
Takeaways
Engage clients in conversations around goals for family participation and legacy
Consider whether a perpetual or a spend-down foundation is the best model before you get started
Provide clients with case studies about how other foundations have managed their sources of philanthropic capital
Read The Billionaire Who Wasn’t by Conor O’Clery here.
DOL Secretary: Modernize OSHA and MSHA to Do More with Less
On June 5, 2025, Secretary of Labor Lori Chavez-DeRemer testified before the House Committee on Education and the Workforce regarding the Trump administration’s proposed fiscal year 2026 budget. The proposed budget includes significant funding reductions for the U.S. Department of Labor (DOL), specifically targeting the Occupational Safety and Health Administration (OSHA) and the Mine Safety and Health Administration (MSHA).
The proposal seeks to cut OSHA’s funding by approximately $50 million and reduce its full-time workforce by 223 positions, shifting the agency’s focus toward increased compliance assistance rather than direct enforcement. The enforcement budget for OSHA would be reduced by about $23.7 million compared to the previous year. Broader DOL cuts are also proposed, with an emphasis on consolidating workforce programs and reducing regulatory burdens.
Quick Hits
Secretary Chavez-DeRemer testified before the House Committee on Education and the Workforce on June 5, 2025, about the Trump administration’s proposed 2026 budget cuts for the DOL, including significant reductions for OSHA and MSHA.
The proposed budget aims to cut OSHA’s funding by $50 million and reduce its workforce by 223 positions, shifting focus to compliance assistance over direct enforcement.
Despite budget cuts, Secretary Chavez-DeRemer emphasized that the DOL would maintain its enforcement capacity through modernization, technology, and streamlined processes.
Secretary Chavez-DeRemer asserted that, despite these budget and staffing cuts, the DOL could maintain its workplace safety and health enforcement capacity. She emphasized the need to modernize and streamline agency operations, arguing that more funding is not always the solution to enforcement challenges. Secretary Chavez-DeRemer stated that the DOL would continue to meet its statutory obligations and that the department would always investigate complaints and enforce the law as required.
Her approach centers on leveraging technology, data analytics, and improved internal procedures to make OSHA more agile and effective. Secretary Chavez-DeRemer has stated that the DOL, including OSHA, must “modernize and streamline” its processes. She contends that this approach will enable the agency to do more with less, focusing on updating systems, leveraging technology, and improving internal procedures. The goal is to make OSHA more agile and effective, even as resources are trimmed.
Streamlining, in Secretary Chavez-DeRemer’s view, means reducing bureaucratic hurdles and eliminating inefficiencies that slow down enforcement and compliance activities. She has pointed to the need for the agency to focus on its core statutory responsibilities and to prioritize activities that have the greatest impact on worker safety. By cutting unnecessary red tape and consolidating overlapping functions, OSHA can direct its limited resources to the most critical areas.
Examples of modernization and streamlining offered by Secretary Chavez-DeRemer included:
Targeted inspections: Using data analytics to identify and focus on the most hazardous workplaces, rather than spreading resources thinly across all employers.
Digital tools: Implementing new technologies for case management, reporting, and communication to speed up investigations and reduce administrative burdens.
Workforce flexibility: Cross-training inspectors and creating multidisciplinary teams to maximize the expertise and adaptability of the remaining staff.
Regulatory reform: Reviewing and revising existing regulations to eliminate outdated or redundant requirements, making compliance simpler for both OSHA and employers.
Unanswered in her testimony was whether employers can expect OSHA to engage in greater use of technology during inspections, such as the so-called smart glasses that are utilized during some inspections. While it can be argued that these smart glasses can create efficiencies consistent with the secretary’s stated goals, many employers object to the use of these devices, as it is difficult, if not impossible, to limit the inclusion of confidential or proprietary information in the inspection and its corresponding inspection file. This can create challenges for employers facing Freedom of Information Act (FOIA) requests for OSHA’s files.
A key element of the proposed strategy is a shift from enforcement-heavy tactics to a greater emphasis on compliance assistance. Secretary Chavez-DeRemer believes that helping employers understand and meet their obligations through education, outreach, and technical support can be as effective as traditional enforcement in promoting workplace safety. This approach is intended to encourage voluntary compliance, reduce the need for resource-intensive inspections, and foster a more collaborative relationship between OSHA and employers. There is no reason to believe that fatality and catastrophe inspections will not continue at or above the historic rates for those inspections.
The reduction in funding and staffing has raised concerns among lawmakers, particularly regarding OSHA’s already limited resources. It was noted that, with current staffing, OSHA can only inspect every workplace in the United States once every 185 years, though, like most statistics, reasonable minds might argue that that interval is too short by several decades, depending on the statistics used. Critics, especially Democrats on the committee, argued that the cuts would further hinder OSHA’s ability to enforce safety standards and respond to violations, including child labor cases. Secretary Chavez-DeRemer responded that the department would focus on efficiency and compliance assistance, but would not compromise on statutory enforcement responsibilities.
For MSHA, the testimony addressed the potential closure of offices, with Secretary Chavez-DeRemer clarifying that decisions to terminate leases were made prior to her confirmation. She indicated efforts were underway to keep essential MSHA offices open, especially in regions with significant mining activity, to ensure statutory obligations for miner safety are met. Lawmakers expressed concern about the impact of office closures on miner safety and MSHA’s ability to conduct necessary inspections and enforcement.
Secretary Chavez-DeRemer’s testimony and approach emphasize a commitment to maintaining OSHA and MSHA enforcement capabilities through modernization, efficiency, and a shift toward compliance assistance, even as the agencies face significant budget and staffing cuts. While she contends that these strategies will allow the agencies to fulfill their statutory responsibilities, lawmakers and critics remain skeptical, warning that the reductions could undermine the agencies’ ability to protect workers and enforce safety standards effectively. Employers can reasonably expect that the number of inspections they face, other than fatality and catastrophe inspections, could drop if this budget is adopted, but if MSHA and OSHA do develop more modern and streamlined processes, those numbers might not drop dramatically.
Treasury’s Latest Moves: Fast-Track for Foreign Investors & Outbound AI Investment Inquiry
The U.S. Department of the Treasury (“Treasury”) has been active in the context of the Committee on Foreign Investment in the United States’ (“CFIUS”) and the Outbound Investment Security Program (“OISP”). The main updates relate to: (1) Treasury’s announcement of an intent to launch a Fast Track Pilot Program under CFIUS for Foreign Investors; and (2) the review of Silicon Valley firm Benchmark Capital’s investment in Manus AI, a Chinese-linked startup.
Fast Track Pilot Program
On May 8, 2025, Treasury announced its intent to establish a fast track process to facilitate greater investment in U.S. businesses from allies and partners, as outlined in the America First Investment Policy Memorandum issued early in the Trump Administration[1] pursuant to the Policy’s objective of maintaining a strong, open investment environment for such parties.
A key feature of the envisioned fast track process involves the launch of a “Known investor portal” through which CFIUS will be able to collect information from foreign investors in advance of a filing. The Known investor portal can potentially be a useful tool for certain investors that either frequently file, or are competing for an opportunity and will benefit in a bid process from Known investor status. Through this approach, Treasury expects not only to maintain and enhance an open investment environment that benefits the U.S. economy, but also to ensure the Committee is able to identify and address any national security risks that may arise from such foreign investments.
The press release regarding Treasury’s intent to launch the Fast Track Pilot Program for Foreign Investors can be accessed through the following link: https://home.treasury.gov/news/press-releases/sb0136.
Review of Benchmark Capital’s Investment in Chinese Startup Manus AI
Treasury is also reviewing a $75 million investment made by Silicon Valley based Benchmark Capital (“Benchmark”), in Manus AI, a Chinese-linked startup (“Manus”).
According to sources, Benchmark received an inquiry from Treasury on “whether its financial backing of Manus AI falls under new restrictions aimed at investments in artificial intelligence and other sensitive technologies destined for ‘countries of concern’.”[2] Such inquiry would come in the context of Treasury’s enforcement of the OISP, under which U.S. entities must notify the Treasury of investments that could “accelerate and increase the success of the development of sensitive technologies” in ways that might harm U.S. interests[3].
Benchmark hasn’t responded publicly with respect to the inquiry, but is expected to argue that notification is unnecessary based on legal advice it had received before investing in Manus.
The issues raised include: (i) whether Manus develops its own AI models (in which case it would be subject to the notification requirement) or if it builds products based on pre-existing models; and (ii) whether Manus can be deemed a Chinese-based company, considering its parent organization is incorporated in the Cayman Islands and the company employs staff in the U.S., Singapore, Japan and China, as well as stores data on cloud servers run by western firms. For many transactions, these and related questions can be difficult to answer, and we are guiding parties through strategies and practices for how to do so.
According to sources, the case highlights the growing tension between promoting technological innovation and protecting national security, and it could set an important precedent for future outbound investment strategies, reviews and national security policy as a whole.
[1] For more information, see: Trump Administration issues America First Investment Policy – Insights – Proskauer Rose LLP. Accessed 6/3/2025.
[2] Cited from: Treasury Probes Benchmark’s Investment in Chinese-Linked AI Startup Manus. Accessed 6/3/2025.
[3] For more information, see: U.S. Department of the Treasury issues final regulations implementing Executive Order 14105 Targeting Tech Investment in China – Insights – Proskauer Rose LLP. Accessed 6/3/2025.
PHANTOM TCPA SETTLEMENT?: Numerous Outlets Are Reporting Credit One Has Settled a TCPA Class Action for $14MM– But Has It?
Weird one for you today.
A number of outlets are reporting Credit One has settled a TCPA class action for $14MM:
https://www.fxstreet.com/analysis/credit-one-bank-sentenced-what-you-need-to-know-about-the-14-million-class-action-settlement-202506161408
https://www.msn.com/en-us/money/other/credit-one-bank-prepares-compensation-for-affected-clients-will-distribute-14-million/ar-AA1Ga67y
https://selendroid.io/credit-one-bank-settlement/
https://www.timesnownews.com/world/us/us-news/credit-one-bank-lawsuit-settlement-key-dates-eligibility-rules-and-how-to-file-a-claim-article-151726973
https://www.hindustantimes.com/world-news/us-news/credit-one-settlement-payment-heres-what-to-know-about-eligibility-amount-and-time-101747025013041.html
https://www.timesnownews.com/world/us/us-news/credit-one-bank-14m-tcpa-robocall-settlement-eligibility-and-payout-details-article-151785865
This is obviously big news. A settlement of that size is noteworthy, especially since class members are apparently to receive $1,000.00 each.
Only problem– it doesn’t seem to have actually happened.
All of these articles discuss the claims process and the amount of the settlement but NONE of them cite the court or case number.
I’ve checked the dockets and don’t see the settlement anywhere.
It appears the articles are confusing a different settlement unrelated to the TCPA and–insanely–citing back to a Reddit article from a few weeks ago as their source.
I invite my wonderful readers to look into this further. Perhaps I am missing something, but I don’t think so.
What can ya’ll dig up?