August 2023

We first look at what generative AI is and how it differs from other types of AI and technology such as machine learning.  We then look at the ways in which banks and fintech companies can deploy AI tools and the business use case for banks and fintechs considering the addition of chatbots, including how chatbots differ from voice response units. … Continue Reading

The CFPB has filed its opposition to the motion for a preliminary injunction filed by the intervenors in the Texas federal court lawsuit challenging the CFPB’s final small business lending rule (Rule).  The intervenors are several credit unions, community banks, and credit union and community bank trade associations.

In the Texas lawsuit, the court entered an order on July 31 that preliminarily enjoins the CFPB from implementing and enforcing the Rule “pending the Supreme Court’s reversal of [Community Financial Services Association of America Ltd.… Continue Reading

On August 28, 2023 (the “Effective Date”), SB 103, signed into law by Missouri’s governor, will become the nation’s second statutory framework for earned wage access (EWA) providers.  The Missouri law closely resembles Nevada’s recently enacted law to license and regulate EWA providers.

SB 103 enacts a new RSMo § 361.749(2), which expressly provides that “[n]o person shall engage in the business of earned wage access services in [Missouri] without first registering as an earned wage access services provider” with the Missouri Division of Finance (the “Division”). … Continue Reading

The Kentucky banks and Kentucky trade association that filed a lawsuit in a Kentucky federal district court challenging the CFPB’s final small business lending rule (Rule) have filed a motion for a preliminary injunction.  The court has ordered the CFPB, if it objects to the motion, to file a response by September 5, 2023.… Continue Reading

On September 7, 2023, at the ABA Business Law Section Fall Meeting in Chicago, Alan Kaplinsky, Ballard Spahr Senior Counsel in the firm’s Consumer Financial Services Group, will moderate a program, “U.S. Supreme Court to Revisit Chevron Deference: What the SCOTUS Decision Could Mean for CFPB, FTC, and Federal Banking Agency Regulations.” … Continue Reading

Townstone Mortgage (Townstone) has filed its brief in the CFPB’s appeal to the U.S. Court of Appeals for the Seventh Circuit from the district court’s decision in the CFPB’s enforcement action against Townstone.  In the decision, the district court ruled that a redlining claim may not be brought under the Equal Credit Opportunity Act (ECOA) because the statute only applies to applicants.… Continue Reading

The CFPB has published a notice in the Federal Register seeking comment on its request for approval by the Office of Management and Budget of a new one-time survey of student loan borrowers.  Comments must be received by September 18, 2023.

The survey is intended to allow the CFPB “to understand [student borrowers’] borrowing decisions, their experience managing their loans, and their expectations for the future.” … Continue Reading

The U.S. Supreme Court has denied the motion filed by the 27 Republican State Attorney Generals who filed an amicus brief in support of Community Financial Services Association in CFSA v. CFPB asking for leave to participate in oral argument.  No explanation for the denial was given by the Court.  While the Supreme Court almost routinely grants requests by the Solicitor General to participate in oral argument as amicus, it grants requests from State Attorneys General to argue as amici with much less frequency.… Continue Reading

Earlier this month, the Maryland Office of Financial Regulation (“OFR”) issued guidance (the “Guidance”) to provide clarity on how the OFR views Earned Wage Access (“EWA”) products and describe the requirements entities offering EWA products must adhere to.

Providing some background for the Guidance, EWA is a financial concept that allows employees to access a portion of their earned but unpaid wages before a regular payday. … Continue Reading

Professor Jeff Sovern, who recently joined the University of Maryland Francis King Carey School of Law faculty, has recently blogged about a forthcoming Study by academicians at other institutions that will be published in the Berkeley Technology Law Journal.  The Study, titled “TL;DR: The Law and Linguistics of Social Platform Terms-of-Use,” examines the content and readability of online terms of use and, according to Professor Sovern, “illustrates how crazy arbitration opt-outs have become.” … Continue Reading