The impact of state usury laws on marketplace lending has been an area of concern since the inception of the industry. In a technique borrowed from the payday lending industry, online platforms that make unsecured consumer...more
Consumer finance:* Credit cards/Consumer credit - Deal activity involving credit card businesses blooms—trade consolidators, financial sponsors and big banks see opportunities - Buyers scrutinise historic compliance...more
The bulletin requires relationships between banks and marketplace lenders to be treated with the same rigor of due diligence and ongoing oversight as other relationships with third parties. On January 24, the Office of...more
On Monday, a federal district court in the Southern District of New York granted a motion to compel arbitration in Bethune v. Lending Club Corporation, et al., a closely watched putative class action raising important issues...more
Deutsche Bank and the DOJ have put the finishing touches on the deal to resolve the investigation into DB’s role in its sale of toxic RMBS. The bank will fork over $7.2 billion in total, including a $3.1 billion civil penalty...more
For the first time, the Office of Comptroller of Currency (OCC) will allow financial technology (fintech) companies to apply for national bank charters. The OCC has invited public comment on the concept with a deadline for...more
The saga of Theranos whistleblower Tyler Shultz, grandson of former Secretary of State (and Theranos director) George Shultz, who faced threats, a familial rift, and a boat-load of legal fees as he tried to expose Theranos’...more
Meanwhile, some banking officials—including a BOE representative speaking in NYC yesterday—contend that the legal expenses related to financial misconduct enforcement actions and litigation (roughly $275 billion for global...more
Holding companies appear to be an important new feature of the “living will” revisions the big banks have been making in an effort to appease the Fed and FDIC’s efforts to stamp out “too big to fail” entities. The idea is for...more
It wasn’t exactly a direct reaction to his testimony on the Hill, but Wells Fargo CEO John Stumpf didn’t do himself any favors there, and Wells Fargo’s Board has announced that it will claw back an estimated $41 million in...more
Financial Industry Developments - OCC Discusses Marketplace Lending - On September 13, 2016, Comptroller of the Currency Thomas J. Curry discussed marketplace lending's risks and associated policy questions. He...more
In case you missed it, here is what the Consumer Financial Protection Bureau (CFPB) was up to over the last month: Enforcement Actions and Litigation - Enforcement Action Against First National Bank of Omaha - ...more
The latest regulator attempting to rein in controls on the marketplace lending industry is the Federal Deposit Insurance Corp. (FDIC). Marketplace lending to consumer borrowers generally runs through state-chartered banks....more
In our last FinTech Flash we covered the pros and cons of marketplace lending platform companies entering into bank partnerships. If the arrangement is structured properly, two significant advantages result...more
A SDNY jury has found former JPMorgan banker Sean Stewart guilty of insider trading based on allegations that Stewart was leaking confidential information about health care company mergers to his dad....more
Marketplace lending has grown dramatically over the last several years, but it still remains a nascent industry. As it continues to expand its reach, players in the industry and the traditional banking/investment sector are...more
The Maryland Court of Appeals, the state's highest court, in CashCall, Inc. et al. v. Maryland Commissioner of Financial Regulation, recently affirmed the judgment of the Court of Special Appeals (MCSA) directing CashCall to...more
Today, July 11, the House Financial Services Committee’s Subcommittee on Financial Institutions and Consumer Credit will hold a hearing titled: “Examining the Opportunities and Challenges with Financial Technology...more
A New York resident, Ronald Bethune, accused LendingClub Corporation of violating the state's usury laws by charging him 29.97 percent interest on his loan—roughly twice the 16 percent limit under New York law and high enough...more
On May 18, 2016, Fitch issued a report entitled: Fitch: NSFR Rule Could Constrain Trust Banks’ Liquidity Position. Report. On May 16, 2016, Fitch issued a report entitled: Fitch: Confidence in US Marketplace Lending ABS Takes...more
Record-setting executive compensation aside (hey, that was so last year), hedge funds have been hammered by the recent spate of mega-deals come undone. Particularly hard hit are the funds focusing on “merger arbitrage”—a type...more
No-Action Letter Issued Regarding the OCR Final Rule - On April 8, the U.S. Commodity Futures Trading Commission's ("CFTC") Division of Market Oversight issued a no-action letter regarding the ownership and control final...more
New guidance being developed by the Federal Deposit Insurance Corporation (FDIC) to address risks associated with banks making loans through third parties could significantly impact marketplace lending, private label credit...more
Regulatory Developments - CFPB Now Accepting Complaints on Online Marketplace Lenders - On March 7, the Consumer Financial Protection Bureau (CFPB) announced two initiatives: it will now accept complaints from...more
The Federal Deposit Insurance Corporation's (FDIC) publication of an article highlighting the risks for banks that partner with marketplace lenders further underscores the focus of federal regulators on marketplace lending....more