Regulatory & Enforcement

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What You Need to Know

Key takeaway #1: Bank regulators have shifted from prior approval to examination scrutiny. Banks no longer need supervisory nonobjection to lend against crypto collateral. Regulators are likely to focus their examinations on collateral operations, BSA/AML and sanctions compliance, and third-party risk management.

Key takeaway #2: Control-based perfection trumps filing, with a June 3, 2027, New York deadline to re-perfect existing security interests. Under the 2022 UCC amendments, a security interest in controllable electronic records perfected by control as of June 3, 2027, will have priority over a filing-only perfection, regardless of timing. Lenders relying on filing alone should consider taking steps to comply with UCC Article 12’s control arrangements before the adjustment date.

Key takeaway #3: Custody terms determine ownership in insolvency. Documents that permit a custodian or platform to use or rehypothecate pledged assets may impair the secured nature of a claim, leaving the lender with an unsecured one. Parties should confirm segregation, retained borrower title, and a prohibition on rehypothecation in custody documentation.

Key takeaway #4: Bankruptcy safe harbors may not apply; margin mechanics are the practical protection. Because spot crypto lending may fall outside the Bankruptcy Code’s safe harbors, conservative advance rates and market-based loan-to-value triggers are the principal protections.

Key takeaway #5: No capital recognition for digital asset collateral, and state licensing may apply. Digital asset collateral currently earns no credit risk mitigation relief under U.S. capital rules, and nonbank lenders may face state licensing obligations.

Continue Reading Lending Against Digital Assets: Five Key Takeaways for Lenders After a Year of Regulatory and UCC Change

The Board of Directors of the Qatar Financial Markets Authority (QFMA) has issued Decision No. 3 of 2026, introducing the Instructions for the International License to Practice Certain Activities in International Financial Markets (the Instructions).

The Instructions create a regulatory framework under which QFMA-licensed financial services firms may, with prior QFMA approval, conduct specified activities in international financial markets. The new regime forms part of Qatar’s broader effort to develop its capital markets and expand access to international investment opportunities while maintaining regulatory oversight and investor protection.

Continue Reading QFMA Introduces International Licensing Regime for Financial Services Firms

For many asset-based lenders (“ABLs”) that do not take deposits, CRD VI’s branch requirements will not apply directly — but reliance on the non-bank carve-out requires careful, structure-specific analysis, and does not eliminate all regulatory risk.

General

CRD VI (Directive 2024/1619) introduces an EU-wide framework governing how non-EU undertakings may provide core banking services to EU borrowers. Article 21c requires third-country undertakings providing core banking services (including lending) within a Member State to establish a branch authorised under the Directive (a “third-country branch”). CRD VI applies primarily to “credit institutions” as defined under the Capital Requirements Regulation (“CRR”). The regime sits alongside existing national licensing frameworks. It should also be noted that CRD VI introduces other obligations (including ESG risk management and governance requirements) beyond the scope of this note.

Continue Reading CRD VI: New Rules for Cross-Border Lending into Europe — Why the Non-Bank Carve-Out Matters, but Is Not the Full Story

On June 4, 2026, Crowell partners Caroline Brown and Anand Sithian hosted the ACSS New York Chapter at the firm’s New York office for a panel discussion titled “Renewed Focus on Cartels, Transnational Criminal Organizations, and Foreign Terrorist Organizations: Compliance Challenges for Financial Institutions and Multinationals.” The sold-out event brought together practitioners from the financial crime compliance community for a timely and substantive conversation at the intersection of sanctions, narcotics trafficking, and AML risk.

Continue Reading Crowell Hosts ACSS New York Chapter Event on Cartels, Foreign Terrorist Organizations, and Financial Crime Compliance

Crowell is proud to serve as a sponsor of and speaker at the American Conference Institute (ACI) 20th annual flagship conference on economic sanctions enforcement and compliance over April 29-30, 2026. Crowell partner and co-chair of the Financial Services group, Carlton Greene, spoke at the conference on “Latin America Under Scrutiny: Mitigating the Expanding Cross-Industry…

Crowell was proud to serve as a sponsor of and speaker at the recent Association of Certified Sanctions Specialists (ACSS) annual U.S. conference on global sanctions and export controls. Crowell partners Anand Sithian and Caroline Brown spoke at the conference. Anand spoke on “The After-Action Review of Recent Sanctions and Export Controls Enforcement Actions,” and Caroline spoke on “The New War on Drugs: Cartels, and Transnational Criminal Organizations.”

The event brought together leading government officials and industry specialists for insight and practical guidance on today’s geopolitical, sanctions, and export controls landscape and the most pressing compliance challenges.

Continue Reading Crowell Sponsors ACSS Annual U.S. Conference on Global Sanctions and Export Controls

On April 14, 2026, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued Venezuela General License 56, “Authorizing Commercial-Related Negotiations of Contingent Contracts with the Government of Venezuela” (GL 56), and Venezuela General License 57, “Authorizing Financial Services Transactions Involving Certain Venezuelan Banks and Government of Venezuela Individuals” (GL 57). OFAC also issued one Venezuela-related Frequently Asked Question (FAQ), FAQ 1248. 

These actions represent the latest steps in a continuing U.S. policy of progressively opening channels for commercial and financial engagement with Venezuela, extending the series of general licenses that OFAC has issued since early 2026 across the energy, petrochemical, minerals, and infrastructure sectors.

Continue Reading OFAC Expands Venezuela Sanctions Relief: New General Licenses 56 and 57, and Guidance on Reporting Obligations

Key Takeaways 

  • The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated six individuals and entities tied to Cartel del Noreste (CDN)—one of Mexico’s most violent drug trafficking organizations—including two CDN-affiliated casinos used for money laundering and drug operations near the U.S.-Mexico border. 
  • OFAC’s actions are the latest examples of a broader national security strategy to use sanctions, AML authorities, criminal prosecutions, and other tools to counter cartels on the U.S.-Mexico border. These efforts have targeted in particular non-traditional financial institutions such as casinos, public-facing professionals, and disinformation actors. 
  • The State Department designated CDN as a foreign terrorist organization (FTO) on February 20, 2026, and today’s designations were issued under both Executive Order 14059 (narcotics trafficking) and Executive Order 13224 (terrorism), underscoring the U.S. government’s treatment of major cartels as hybrid criminal-terrorist threats.
Continue Reading OFAC Sanctions Cartel-Linked Casinos and Financial Enablers on the Southern Border 

On Jan. 14, New York state Sen. Zellnor Myrie proposed legislation in the New York State Senate that would amend New York law to make it a criminal offense to operate a virtual currency business in the state without the proper license.

By introducing the possibility of criminal penalties, S.B. 8901 — the Cryptocurrency Regulation…

Overview

On March 12, 2026, the U.S. Commodity Futures Trading Commission (CFTC) took formal steps toward establishing additional regulations for prediction markets. The agency issued an Advanced Notice of Proposed Rulemaking (ANPRM) soliciting public input on potential new rules, and separately, released staff guidance outlining its views on how existing rules apply to prediction market platforms currently in operation. These developments signal a significant shift in the regulatory landscape for an industry that has grown rapidly over the past year.

Continue Reading CFTC Takes Additional Steps Toward Prediction Market Regulation: What You Need to Know