Jai R. Massari

Ms. Massari is a partner in Davis Polk's Financial Institutions Group and the trading and markets practice. [Full Bio]

Latest Articles

After a several-year pause, the CFTC is again re-assessing its approach to cross-border regulation of swap activities. The CFTC’s current approach is embodied in various rulemakings, guidance, orders, and agreements with non-U.S. regulators that have been adopted, issued, and entered into since 2013. The CFTC has, over the past several years, periodically sought to adjust or re-evaluate its approach to cross-border swaps regulation, including in a 2016 Proposed Cross-Border Rule. CFTC Chairman Giancarlo has…
On October 11, 2018, the SEC reopened the comment period and requested additional comments for previously proposed rules relating to capital, margin, and segregation requirements for security-based swap dealers (“SBSDs”), major security-based swap participants (“MSBSPs,” and together with SBSDs, “SBS Entities”) and, in some cases, broker-dealers.  The rules, most of which were initially proposed six years ago, would establish: capital and margin requirements for non-bank SBS Entities (the federal banking regulators adopted capital and margin…
It is no secret that the United States lags behind other countries in the development of a national real-time payments infrastructure.[1]  There are, of course, explanations for this lag, including widespread participation in the existing infrastructure rails and the existence of many different stakeholder interests limiting consensus over reforms.  So far, the Federal Reserve has been cautious, using its powers of moral suasion and its intellectual firepower to bring together stakeholders to start…
The regulation and operations of virtual currency exchanges are again in the spotlight, due to the new report issued by the Office of the New York Attorney General (OAG).  The report, which follows the April launch by the OAG of its Virtual Markets Integrity Initiative (VMII), describes in detail the results of the OAG’s “fact-finding inquiry into the policies and practices of platforms used by consumers” (discussed in an earlier Blockchain Bulletin). The…
After a several month lull that led some to question the SEC’s focus on crypto enforcement, this week saw a spate of enforcement activity involving crypto assets: several SEC enforcement actions, an SEC trading suspension order, the first FINRA cryptocurrency enforcement action, and a preliminary court decision consistent with the view that ICO tokens may be (and perhaps often are) securities.  These actions give life to SEC Chairman Clayton’s statement that “to the extent something…
The FTC is expanding its enforcement efforts for fintech, particularly in the areas of online and small-business lending, payments, and cryptocurrencies.  At a recent event in Washington, D.C., the FTC’s Director of Consumer Protection, Andrew Smith, stated, “Commissioners are really interested in [fintech].  Finance will be a steady part of our diet, and in particular fintech, ’cause that’s where the new entrants to the marketplace are and that’s where the action is.” Because the FTC…
The Office of the Comptroller of the Currency (OCC) has granted conditional approval to digital-banking startup Varo Bank (previously Varo Money) of its application to form a de novo national bank.  Varo Bank, N.A. would become the first mobile-only national bank in United States. This is an interesting development in several respects: Varo Money began as a fintech startup providing mobile banking products and online lending in partnership with banks. Varo did not, however, pursue…
The ability of banks to sell the loans they originate is a core element in the development and sustainability of a nationwide lending market.  Recent legal developments threaten to undermine this ability, jeopardizing the foundation of a U.S. nationwide loan market and the core lending activities of banks. A long-settled legal principle known as the “valid-when-made” doctrine has served for almost two centuries as the bedrock for bank lending.  This doctrine has been threatened by…
In its recent report on financial innovation, the U.S. Treasury Department calls upon federal banking regulators to address the uncertainty in lending markets created by the Madden case and True Lender developments. The Report recognizes that “unsecured consumer credit could be diminished because nonbank firms such as marketplace lenders may be discouraged from purchasing and attempting to collect on, sell, or securitize loans made in these states because of the risk of litigation asserting violations…
The Federal Reserve’s current approach to determining whether a banking organization has control over another company for purposes of the Bank Holding Company Act can discourage fintech investments by banking organizations.  This impact was discussed in the Treasury Department’s report on nonbank financial institutions, fintech and innovation.  The report highlights two reasons why the Federal Reserve’s current approach is concerning to fintech firms.  First, fintech firms would like to avoid being treated as affiliates of…