The Consumer Financial Protection Bureau, the California Department of Financial Protection and Innovation (CA DFPI), and ten state Attorneys General have filed a lawsuit against Prehired, LLC (Prehired) and two related companies, Prehired Recruiting, LLC and Prehired Accelerator, LLC, alleging that the companies violated the Consumer Financial Protection Act (CFPA), the Truth in Lending Act (TILA), and the Fair Debt Collection Practices Act (FDCPA) in connection with offering and collecting on income share agreements (ISAs). … Continue Reading
Income Share Agreements
California DFPI issues proposed rules implementing Student Loan Servicing Act
By Lisa Lanham & John Georgievski on
On September 9, 2022, the California Department of Financial Protection & Innovation (the “DFPI”) released a Notice of Proposed Rulemaking Action that proposes to adopt regulations implementing the Student Loan Servicing Act (section 28100, et seq.) and the Student Loans: Borrower Rights Law (Civil Code section 1788.100, et seq.). … Continue Reading
This week’s podcast: What will 2022 hold for fintechs in the consumer financial services industry—a discussion with special guest Todd Baker, Senior Fellow at the Richman Center for Business, Law & Public Policy at Columbia University
Rising interest rates and inflation are two key factors that are expected to create a more challenging business environment in 2022. Based on his work at the intersection of technology and financial services, Todd shares his perspective on how this new environment is likely to impact providers of various types of consumer financial services, particularly non-bank fintech companies. We… Continue Reading
CFPB Alleges Income Share Agreements are Extensions of Credit in Results-Oriented Enforcement Action against ISA Originator
By Heather S. Klein, John L. Culhane, Jr. & Ballard CFS Group on
(Ballard Spahr will hold a webinar on 9/21 at 3pm ET, “The Path Forward for Income Share Agreements.” Register online here.)
The CFPB issued a consent order against an income share agreement (ISA) provider, Better Future Forward (BFF), in which it concluded that BFF’s ISAs are extensions of credit under the Consumer Financial Protection Act and Truth in Lending Act and are “private education loans” under TILA. … Continue Reading
Colorado Private Education Lender Registration Takes Effect September 1, and Schools Using Income Share Agreements Are Covered
By Heather S. Klein, John L. Culhane, Jr. & Ballard CFS Group on
With Colorado’s private education lender registration scheduled to take effect on September 1st, the Colorado Department of Law has just announced that they intend to bring a new group within their jurisdiction: private postsecondary schools that use income share agreements (ISAs) to help finance students’ education. Schools regulated by the Division of Private Occupational Schools received notice of this interpretation on Friday.… Continue Reading
California DFPI announces agreement with program manager of income share agreements
By John L. Culhane, Jr., Heather S. Klein & Ballard CFS Group on
Last week, the California Department of Financial Protection and Innovation (DFPI) announced that it had entered into “a landmark agreement” with Meratas, Inc., a company that acts as a program manager of Income Share Agreements (ISAs) used to finance postsecondary education and training. The agreement includes the DFPI’s finding that ISAs made solely for the purpose of financing a postsecondary education are “student loans” under the SLSA.… Continue Reading