CFPB and FTC to Host Credit Reporting Accuracy Workshop The Federal Trade Commission (“FTC”) and the Consumer Financial Protection Bureau (“CFPB”) recently announced that they will be hosting a public workshop on December 10, 2019 to discuss issues related to the accuracy of credit reports and background screening reports for employment and housing rental purposes. The FTC published a study on accuracy in credit reporting in 2012, the same year the CFPB began supervising large…

California Governor to Consider Capping Rate on Finance Lender Loans The California State Assembly passed Assembly Bill 539, the Fair Access to Credit Act (FACA), with a vote of 61 to 8. FACA prevents licensed finance lenders from charging more than 36% (plus the federal funds rate) on consumer loans between $2,500 and $10,000. Reports from California’s Department of Business Oversight (DBO), as previously discussed here, found that many loans carried triple-digit annualized interest…

Domestic CSBS Suit Challenging OCC Fintech Charter Dismissed For the second time, a federal judge has dismissed a suit brought by the Conference of State Bank Supervisors (“CSBS”) seeking to block the Office of the Comptroller of the Currency (“OCC”) from offering a national fintech banking charter. Judge Dabney Friedrich of the D.C. Circuit again found that the claims brought by the CSBS are not ripe, given that the no fintech charters have been approved…

CFPB fines company for allegedly deceiving customers The Consumer Financial Protection Bureau (“CFPB”) issued a consent order against a Texas money transmitter who communicated to customers that it would not be responsible for “errors made by banks or payment agents, or for any other reasons out of our control.” The company, Maxitransfers Corporation, focuses its business on providing remittance services to the Latin American community. The consent order notes that remittance transfer providers are responsible…

U.S. Developments California Proposes Regulations to Implement New Disclosure Requirements for Commercial Financing Recently, the California Department of Business Oversight (“CA DBO”) issued proposed regulations to implement SB 1235, a 2018 law that, in certain situations, requires consumer-like disclosures for certain commercial financing transactions. The law has a few notable exemptions, including depository institutions, financings in excess of $500,000, transactions secured by real property, and closed-end loans that involve a principal of less than…

U.S. Developments Federal Reserve to Build Real-Time Payments System After years of speculation, the Federal Reserve announced this week it will create a real-time payments system, which it expects to be live by 2023 or 2024. The system, the FedNow Service, was announced by Federal Reserve Governor Lael Brainard during a speech at the Federal Reserve Bank of Kansas City. During the announcement, Brainard highlighted the strong support for the project the Federal Reserve received…

U.S. Developments FinCEN and Others Issue Joint Statement on BSA/AML Examinations The Financial Crimes Enforcement Network (FinCEN) and several other federal banking regulators, including the Federal Deposit Insurance Corporation, National Credit Union Administration, the Office of the Comptroller of the Currency, and the Board of Governors of the Federal Reserve, issued a joint statement on Bank Secrecy Act and Anti-Money Laundering (BSA/AML) examinations of bank compliance programs. The joint statement does not establish new requirements,…