On November 29, 2023, the U.S. Supreme Court will hear oral argument  in Jarkesy v. Securities and Exchange Commission, a case in which the respondents are challenging the constitutionality of the SEC’s use of administrative law judges (ALJs).  The outcome of the case could have significant implications for the use of ALJs by all federal agencies, including the CFPB, FTC, and federal banking agencies.  … Continue Reading

On November 2, 2023, the Consumer Financial Protection Bureau issued a report on the community reinvestment laws of seven states (Connecticut, Illinois, Massachusetts, New York, Rhode Island, Washington, West Virginia), and the District of Columbia that evaluate the record of state-chartered financial institutions and other lenders in meeting the credit needs in their communities.… Continue Reading

The Federal Trade Commission recently prevailed on summary judgment in a case against Jonathan Braun and his company RCG Advances, LLC.  The product at issue, merchant cash advances, generally provide small businesses with critical and timely financing, and there was no dispute that the defendants gave these businesses upfront lump-sums of money in exchange for the right to collect future receivables. … Continue Reading

On November 30, 2023 at 12:30 PM, ET, Ballard Spahr will hold a webinar entitled “Recent Important Developments in Federal Preemption for National and State Banks: What They Mean for Bank and Nonbank Consumer Financial Services Providers” during which this case will be dissected.

In a lengthy (65-page) order, the California Superior Court in Los Angeles has issued an extremely important decision upholding the legitimacy of bank-model online lending by denying a motion for preliminary injunction filed by the California Department of Financial Protection and Innovation (DFPI) that sought to force fintech Opportunity Financial LLC (OppFi) to stop facilitating loans to California borrowers from its partner FinWise Bank at interest rates above the interest rate cap (generally 36% plus the Federal Funds Rate) imposed by the California Financing Law (CFL).… Continue Reading

On October 3, 2023, the U.S. Supreme Court held oral argument in CFSA v. CFPB, a case with profound potential implications for the future of the CFPB.  The Court will rule on whether the CFPB’s funding mechanism violates the U.S. Constitution’s Appropriations Clause and, if so, what the appropriate remedy should be. … Continue Reading

On October 27, the Federal Trade Commission (“FTC”) unanimously voted to amend the Safeguards Rule to require non-banking financial institutions, such as mortgage brokers, motor vehicle dealers, and payday lenders, to report data breaches and security events to the Agency. This amendment will become effective 180 days after its publication in the Federal Register.… Continue Reading

Alan Kaplinsky, Senior Counsel in and former Practice Group Leader of Ballard Spahr’s Consumer Financial Services Group and frequent host of the Consumer Finance Monitor Podcast (a weekly podcast episode sponsored by our Consumer Financial Services Group) was recently the special guest of Bloomberg Intelligence analysts Elliott Stein and Nathan Dean on their podcast, Votes and Verdicts. … Continue Reading

On October 29, the Biden Administration issued a broad Executive Order (Order) on artificial intelligence (AI).  Titled “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence,” the Order establishes guidelines for AI safety and security, aims to shield Americans’ data privacy, and emphasizes equity and civil rights. … Continue Reading

The Federal Trade Commission and Wisconsin Attorney General have entered into settlements with a group of auto dealerships, their current and former corporate owners, and their general manager for allegedly engaging in unlawful discrimination in connection with financing offered to customers and for allegedly engaging in deceptive practices in connection with the sale of add-on products. … Continue Reading

The Texas federal district court hearing the lawsuit challenging the validity of the CFPB’s final rule implementing Section 1071 of the Dodd-Frank Act (Rule) has issued an order that preliminarily enjoins the CFPB from implementing and enforcing the Rule on a nationwide basis against all entities covered by the Rule.  On July 31, the court had denied the request of the plaintiffs in the lawsuit for nationwide preliminary relief and instead issued an order that granted preliminary relief only to the plaintiffs and their members. … Continue Reading