CFPB, Federal Agencies, State Agencies, and Attorneys General
Earlier this month, the Federal Reserve Board (FRB) released two supervision and regulation letters regarding the agency’s program to supervise “novel” banking activities.
The release of these letters follows a January policy statement indicating the FRB’s interest in leveling the playing field in terms of subjecting uninsured and insured banks to the same limitations on activities, including novel banking activities. … Continue Reading
In January 2023, a federal district court in Texas dismissed Michael v. Opportunity Financial, LLC, a putative class action filed in June 2022 claiming that fintech Opportunity Financial, LLC (OppFi), not its out-of-state, state-chartered bank partners, is the “true lender” on loans with interest rates permitted under the laws of the banks’ home states, but higher than allowed in the plaintiffs’ states. … Continue Reading
In its April 2023 Opposition to the California Department of Financial Protection and Innovation (DFPI) motion for preliminary injunction, Opportunity Financial, LLC (OppFi) presents a spirited riposte, drilling down into the DFPI’s fact allegations and legal arguments and asserting “The DFPI is wrong on the law and wrong on the facts.”… Continue Reading
A fintech peer-to-peer lender has entered into separate consent orders with California, Washington D.C., and Connecticut relating to its practice of requesting tips and donations in connection with the loans offered through its platform. The fintech’s platform offers opportunities for members to act as borrowers or lenders and facilitates loans between its members.… Continue Reading
The FDIC recently announced that it has entered into a Consent Order with Cross River Bank (CRB or Bank) to resolve FDIC charges that the Bank engaged in unsafe or unsound practices related to its fair lending compliance. (The Consent Order was issued in March 2023 but not made public until the end of last month.) … Continue Reading
The Government Accountability Office (GAO) has issued a new report entitled “Financial Technology: Products Have Benefits and Risks to Underserved Consumers, and Regulatory Clarity Is Needed.”
The report focuses on the following four types of fintech products:
Earlier this month, the Federal Deposit Insurance Corporation (FDIC) issued cease-and-desist letters to a cryptocurrency exchange and a fintech, demanding that each of these entities immediately stop making false and misleading statements about FDIC coverage of their financial products. The FDIC also issued cease and desist letters to two marketing websites, demanding that they remove false and misleading statements about FDIC insurance coverage with respect to the cryptocurrency exchange.… Continue Reading
We begin with a discussion of the goals and themes of FTA’s recent summit and AFC’s advocacy regarding retention of the strategic plan option under the Community Reinvestment Act. We then discuss consumer benefits of buy-now-pay-later (BNPL) and regulatory concerns raised by the CFPB in its BNPL report, state level regulatory issues facing fintechs, the Treasury’s report on bank/fintech relationships and takeaways for fintechs, consumer benefits of earned wage access products and artificial intelligence and regulatory concerns raised by the CFPB, and reactions to the CFPB’s Section 1033 rulemaking.… Continue Reading
Earlier this week, Senator Sherrod Brown (D-Ohio) introduced a bill, the “Close the Shadow Banking Loophole Act,” (Act) that is intended to close what is often termed a “loophole” in the Bank Holding Company Act (BHCA) because it allows the parent companies of industrial loan companies (ILCs) to operate without the same level of federal oversight that applies to parent companies of other banking institutions.… Continue Reading
The Treasury Department has released a report entitled “Assessing the Impact of New Entrant Non-bank Firms on Competition in Consumer Finance Markets.” The report was issued in response to President Biden’s July 2021 Executive Order on promoting competition. That Order directed the Secretary of the Treasury to issue a report assessing how the entry of large technology firms and other non-banks into consumer finance markets has affected competition.… Continue Reading
