The Board may act against a State issuer in unusual and exigent circumstances
What the document says“under unusual and exigent circumstances that the Board determines to exist, the Board may, after not less than 48 hours' prior written notice to the applicable State payment stablecoin regulator, take an enforcement action against a State qualified payment stablecoin issuer”
Subsection (e)(1)(A). The sentence continues that the action may also be taken against an institution-affiliated party of the issuer, for violations of the Act during those circumstances. The quotation stops before that phrase because the printer breaks the word across a line. Two conditions attach: the Board must determine that unusual and exigent circumstances exist, and it must give the State regulator at least 48 hours' prior written notice. Under subparagraph (B) the Board is to issue rules, consistent with section 13, setting out the circumstances in which it may act.
What the document actually says“under unusual and exigent circumstances that the Board determines to exist, the Board may, after not less than 48 hours' prior written notice to the applicable State payment stablecoin regulator, take an enforcement action against a State qualified payment stablecoin issuer”
The Fed may act against a state maker in a crisis. It must decide that things are that bad. It must warn the state watchdog 48 hours ahead.
This is a break from the usual split of work. A state watchdog handles its own makers. The Fed must write rules on what counts as a crisis.
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