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Category Archives: Regulatory and Compliance

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Mandatory Cash Acceptance Update – Philadelphia Legislation & Athletic Venues

Posted in Privacy and Data Security, Regulatory and Compliance
On March 18, the Governor of New Jersey signed a bill making his state just the second to require that certain businesses accept cash as a form of payment. DWT has previously detailed this bill, as well as pending legislation in a number of American cities that would likewise require retailers to accept cash. Since our previous post, Philadelphia has becom… Read the rest

Mandatory Cash Acceptance Legislation and the Ongoing Argument Over Going Cashless

Posted in Privacy and Data Security, Regulatory and Compliance
In an American economy driven by Silicon Valley, where Americans pay more than half of their bills online, and millennials have taken to online social platforms like Venmo to split the bill for dinner, cash continues to represent nearly a third of transactions in the United States. In fact, though you wouldn’t know it from the ubiquitous swiveling iP… Read the rest

Visa and Mastercard Obtain Preliminary Approval of Second Attempt at Interchange Settlement

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
On January 24, 2019, Judge Margo K. Brodie of the U.S. District Court for the Eastern District of New York granted preliminary approval of Visa and Mastercard’s second attempt to settle the 13-year old antitrust litigation brought by approximately 12 million merchants, alleging that Visa, Mastercard, and several issuing and acquiring banks cons… Read the rest

Federal Reserve Seeks Comment on Actions to Promote Faster Payments

Posted in Regulatory and Compliance
On November 15, 2018, the Board of Governors of the Federal Reserve System (Board) published in the Federal Register its request for public comment on potential actions the Federal Reserve could take to “promote ubiquitous, safe, and efficient faster payments in the United States by facilitating real-time interbank settlement of faster payments”… Read the rest

New CFPB Proposal to Overhaul Existing No-Action Letter Policy and Create a Federal Regulatory Sandbox

Posted in Regulatory and Compliance
FinTech appears to be the next industry set to benefit from the Trump administration’s ongoing deregulatory push. The Bureau of Consumer Financial Protection’s (“Bureau”) long-gestating update to the Obama era no-action letter policy was announced as one of the final acts of outgoing Acting Director Mick Mulvaney. Though no-action letter po… Read the rest

State of Regulation: Focus on FinTech

Posted in Regulatory and Compliance
On Thursday, November 8, DWT FinTech team co-leader Andy Lorentz took part in the Commerce.Innovated Class 8 Demo Day in New York City. Andy led a discussion on legal developments in FinTech, with a focus on federal regulatory rollbacks, an update on federal enforcement activities, a discussion of the regulatory environment at the state level, and an over… Read the rest

California Near to Enacting Nation’s First Commercial Finance Disclosure Law

Posted in Regulatory and Compliance
In the final days of its 2018 session, the California legislature sent a flurry of bills to Governor Jerry Brown’s desk on topics as diverse as net neutrality, school start times, and clean energy. But it is SB 1235, “Commercial financing; disclosures,” that may be of particular note for commercial lenders.  The bill is designed to give small busine… Read the rest

States Diverge From Federal Regulators on Disparate Impact

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
Federal and state fair lending regulators are charting different courses for the future of “disparate impact” liability under the Equal Credit Opportunity Act and analogous state law. For its part, the federal policymaking apparatus is working to limit or eliminate disparate impact liability under ECOA, basing the change on the Supreme Court’s… Read the rest

Third Circuit Says CFPB May Investigate the Totality of a Target’s Business Conduct

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
Earlier this week, the Third Circuit rejected student loan servicer Heartland Campus Solutions, ECSI’s challenge to a CFPB civil investigative demand (CID), which sought information concerning ECSI’s “servicing of student loans, including processing payments, charging fees, transferring loans, maintaining accounts, and credit reportin… Read the rest

Arizona Attorney General Launches Regulatory Sandbox Program for Fintech Companies

Posted in Deals and Technology, Regulatory and Compliance
The financial technology company seeking to launch an innovative financial product or financial service—and in need of a group of consumers to test whether the idea even works—might consider working in Arizona’s FinTech Sandbox. The Arizona Attorney General, Mark Brnovich, has established the state’s Regulatory Sandbox Program (“Sand… Read the rest

U.S. Supreme Court Sides with Amex in Landmark Card Case

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
A divided U.S. Supreme Court sided with American Express Company and American Express Travel Related Services Company (Amex) over Ohio, sixteen other states and the United States based on the Court’s application of the theory of two-sided markets. Ohio v. American Express Co., No. 16-1454, slip op. at 2 (June 25, 2018). At issue were Amex’s antisteer… Read the rest

Is Kraninger’s Nomination to Head Bureau a Tactical Choice to Continue Mulvaney’s Policy Trajectory?

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
President Trump formally nominated Kathy Kraninger to become the new head of the Consumer Financial Protection Bureau (the “Bureau”) on June 18, 2018. While this nomination was a surprise to many due to Kraninger’s apparent lack of financial or consumer regulatory experience, the timing of the nomination and associated tactical considerations… Read the rest

What the Security Group Consent Order Suggests About the CFPB’s Direction

Posted in Regulatory and Compliance
For many months, the Consumer Financial Protection Bureau (Bureau) has hinted it would focus its enforcement efforts on debt collection conduct. The Bureau’s settlement earlier this month with Security Group Inc., Security Finance Corporation of Spartanburg, and Professional Financial Services Corp. (collectively, “Security Group”) is th… Read the rest

Debtors Lose? Third Circuit Rejects “Discovery Rule,” Restricts Period to Assert Federal Debt Collection Actions in Break With Fourth and Ninth Circuits

Posted in Regulatory and Compliance
In an en banc decision issued last Tuesday, the Third Circuit held that civil actions alleging violations of the Fair Debt Collection Practices Act (FDCPA) must be filed within one year from the date of the violation’s occurrence – and not when the violation was discovered. The Third Circuit’s decision in Rotkiske v. Klemm directly conflicts with Fo… Read the rest

Fintech Sandboxes – Update on State Approaches

Posted in Deals and Technology, Regulatory and Compliance
Arizona’s Fintech Sandbox Last month Arizona became the first U.S. state to enact a law allowing for the establishment of a fintech regulatory sandbox program (H.B. 2434) to facilitate the growth of innovative financial products and services. The Arizona law charges the Attorney General to “establish a regulatory sandbox program” which would, i… Read the rest

Rumors of UDAAP’s Demise May be Exaggerated

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
New Priorities at the CFPB… On February 12, 2018, Acting Director of the Consumer Financial Protection Bureau (“CFPB” or the “Bureau”) and Director of the Office of Management and Budget (“OMB”), Mick Mulvaney, released two documents that provide further insight into the future of the Bureau. But while one describes an out of control Bure… Read the rest

CARD Act Report: The CFPB Departs from Precedent

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
Editors’ Note: The following is one part of DWT’s ongoing coverage of the 2017 CARD Act Report.  Other parts include our prior PLA post The Consumer Credit Market: The CFPB’s 2017 CARD Act Report and a recent FSR webinar. This article also appears in The Review of Banking & Financial Services. On December 27, 2017, as required by law, the Consumer… Read the rest

CSBS Takes Another Step Towards Multi-State Licensing for New MSB Applicants

Posted in Regulatory and Compliance
The Conference of State Bank Supervisors (“CSBS”) has announced a multi-state framework for state regulators to process an application by a person to become a licensed money services business (“MSB”).  The announcement forms part of the ongoing development of Vision 2020 for supervising non-depository financial institutions engaged in fi… Read the rest

The Consumer Credit Market: The CFPB’s 2017 CARD Act Report

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
The Consumer Financial Protection Bureau recently published its biennial assessment of the consumer credit card market, titled “The Consumer Credit Card Market.” This report is based in part on responses provided by market participants to the CFPB’s request for information on the consumer credit card market, which we discussed here. The CFPB… Read the rest

Next Steps for the CFPB

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
Richard Cordray, the director of the U.S. Consumer Financial Protection Bureau (CFPB), resigned from this post at the close of business last Friday, November 24.  In a statement to staff, he said that Leandra English, the CFPB’s chief of staff, had been named deputy director and would take over as acting director of the agency upon his exit.  On that Fri… Read the rest

Federal Reserve Enters Consent Order to Sanction Deceptive Practice Involving Credit Card Product

Posted in Regulatory and Compliance
The Board of Governors of the Federal Reserve System (Federal Reserve) recently exercised its authority to enforce laws prohibiting unfair or deceptive acts or practices committed by a financial institution under the Federal Reserve’s jurisdiction. On October 26, the Federal Reserve entered a consent order with Mid America Bank & Trust Co. (Mid… Read the rest

CFPB Highlights Supervisory Findings Related to Credit Cards

Posted in Financial Services Litigation and Enforcement, Regulatory and Compliance
The Consumer Financial Protection Bureau’s (CFPB) most recent Supervisory Highlights report identified a number of areas of non-compliance by credit card issuers that were confidentially resolved in the supervisory process. These periodic reports are intended to identify potential areas of non-compliance observed in the marketplace by the CFPB… Read the rest