The parties in Petersen v. Chase Card Funding, LLC and Cohen v. Capital One Funding, LLC, have filed Stipulations agreeing to the withdrawal with prejudice of the plaintiffs’ appeals to the Second Circuit from the district courts’ decisions holding that the National Bank Act (NBA) preempts their claims that the interest charged on credit
usury
Plaintiffs file appeals with Second Circuit from district court decisions holding NBA preempts application of state usury law to securitized credit card receivables
By Alan S. Kaplinsky on
The plaintiffs in Cohen v. Capital One Funding, LLC and Petersen v. Chase Card Funding, LLC have filed appeals with the Second Circuit from the decisions of two New York federal district courts that held the National Bank Act (NBA) preempts their claims that the interest charged on credit card receivables assigned to affiliated securitization…
Second NY federal district court holds NBA preempts application of state usury law to securitized credit card receivables
By Jeremy T. Rosenblum on
In Cohen v. Capital One Funding, LLC, the federal district court for the Eastern District of New York joined the federal district court for the Western District of New York in Petersen v. Chase Card Funding, LLC in holding that the National Bank Act (NBA) preempts claims that the interest charged on credit card…
NY federal district court holds NBA preempts application of state usury law to securitized credit card receivables
By Jeremy T. Rosenblum on
A New York federal district court in Petersen v. Chase Card Funding, LLC held that the National Bank Act (NBA) preempted the plaintiff’s claims that the interest charged on his credit card account violated New York usury law.
The named plaintiff was the holder of a credit card issued by JPMorgan Chase Bank, N.A. (JPMCB). …
This week’s podcast: A discussion of the Veterans and Consumers Fair Credit Act with Bill Himpler, CEO of the American Financial Services Association
By Barbara S. Mishkin on
Posted in Regulatory and Enforcement, Usury
The Veterans and Consumers Fair Credit Act, which has been introduced in the House (H.R. 5050) and Senate (S. 2833), would impose a 36% national usury limit on most forms of consumer credit. Bill Himpler responds to claims that the rate limit will not reduce credit access for creditworthy consumers and discusses relevant studies, the…
Virginia House of Delegates passes bill to establish 36% rate cap for “short-term” and other loans
By Alan S. Kaplinsky on
Posted in Regulatory and Enforcement, Usury
On January 31, 2020, by a vote of 65 to 33, the Virginia House of Delegates passed a bill that would establish a 36% rate cap on certain consumer loans. Since Democrats also hold a majority in the Virginia Senate, the Senate is expected to also pass the bill.
The bill amends Virginia’s general…
This week’s podcast: The Veterans and Consumers Fair Credit Act: a discussion with the bill’s drafter
By Barbara S. Mishkin on
Posted in Usury
The Act, which has been introduced in the House (H.R. 5050) and Senate (S. 2833), would impose a 36% national usury limit on most forms of consumer credit. We are joined by the bill’s drafter, Professor Chris Peterson of the University of Utah S.J. Quinney College of Law, for a discussion of the rationale for…
CFPB announces proposed consent order with companies alleged to have collected loans void under state law
By Alan S. Kaplinsky on
The CFPB announced that it has entered into a proposed consent order with Think Finance and six subsidiaries (collectively, the “Think Entities’) to settle the Bureau’s lawsuit filed in November 2017 that alleged the Think Entities engaged in unfair, deceptive, and abusive acts or practices in connection with their collection of loans that were void…
OCC and FDIC issue proposed rules to undo Madden
By Jeremy T. Rosenblum on
The OCC and FDIC issued proposed rules this week intended to eliminate the uncertainty created by the Second Circuit’s decision in Madden v. Midland Funding. In that decision, the Second Circuit held that a nonbank that purchased charged-off loans from a national bank could not charge the same rate of interest on the loan…
Small business borrowers bring lawsuit alleging lender engaged in “rent-a-charter” scheme to make usurious loans
By Alan S. Kaplinsky & Mark J. Levin on
A group of small businesses and their individual owners have filed a putative class action lawsuit in a New York federal district court against online lender Kabbage, Inc. that alleges Kabbage engaged in a “rent-a-charter” scheme to make loans at interest rates that were usurious under state law.
According to the complaint, Kabbage entered…