Regulation

The Employee Suing SoFi Only Worked There for Three Months

August 15, 2017
Article by:

Courtroom

On Monday, several news outlets reported that a former employee of SoFi was suing for wrongful termination after he not only reported sexual harassment in the workplace, but also exposed an internal loan cancellation scheme designed to pad the bonuses of certain employees. According to the complaint, which you can read for yourself here, plaintiff […]

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The CFPB is Asking The Wrong Questions, Bank President Says

July 13, 2017
Article by:

CFPB Logo

David Ludwig, the Bismarck branch president of Security First Bank of North Dakota, responded to the CFPB’s small business lending RFI earlier this week. In his written comment, he points out the futility of examining race, gender and ethnicity to judge how a lender is approving business loans. These data points are what the CFPB […]

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CFPB’s New Arbitration Rule Does Not Apply to Business Loans

July 10, 2017
Article by:

CFPB Director Richard Cordray at Money2020 in 2016

The CFPB’s new rule to regulate arbitration clauses in consumer finance contracts does not apply to business loans, according to the agency’s fine print. Page 403 of 775 (that’s how long the rule is) includes a footnote that says: As is explained in proposed comment 3(a)(1)(i)-1, Regulation B defines “credit” by reference to persons who […]

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CFPB Pushes Back Small Business Lending Comment Deadline

July 7, 2017
Article by:

Government vs. Business

The CFPB has pushed back its small business lending comment deadline from July 14th to September 14th. The Request for Information is the first step of its initiative to monitor business loans to women and minorities, as directed by Section 1071 of Dodd-Frank. Only 15 comments have been submitted so far, a number likely too […]

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All Companies Can Now Submit Draft IPO Registrations Confidentially

June 29, 2017
Article by:

SEC Building

There’s a reason the public never got to view BFS Capital’s September 2015 IPO registration documents. Thanks to the JOBS Act, “an emerging growth company may confidentially submit to the Commission a draft registration statement for confidential, non-public review by the Commission staff prior to public filing.” They can then choose to abandon the offering […]

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SoFi Bank Puts ILC Charter in Spotlight

June 28, 2017
Article by:

SoFi

is SoFi exploiting a legal loophole? Christopher Cole, EVP & Senior Regulatory Counsel, ICBA Online lender SoFi’s decision to apply for a bank charter has snagged the attention of alternative lenders, big and small banks and regulators alike. Market participants appear split between cheering the move and drawing a line in the sand. One thing […]

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Puerto Rico Bankers Association Calls Section 1071 Absurd and Unreasonable

June 28, 2017
Article by:

Banco Popular in San Juan, Puerto Rico

Section 1071, the law that grants the CFPB authority to collect loan application data on minority and women-owned businesses, is under fire, again. This time it’s the Puerto Rico Bankers Association in response to the CFPB’s RFI on the matter. In a letter, the PRBA points out the sheer irony of conducting costly disparate impact […]

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Congressman Emanuel Cleaver, II Makes Inquiry Into Merchant Cash Advances

June 26, 2017
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Congressman Emanuel Cleaver, II

A US Congressman from the fifth district of Missouri is conducting an inquiry into “Fintech Lending,” according to a statement posted online. Rep. Emanuel Cleaver, II published letters that his office sent out last week to five companies seeking information on how they avoid discriminatory lending practices in small business lending. An excerpt: I have […]

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US Treasury Calls for Section 1071 to Be Repealed

June 19, 2017
Article by:

Treasury Department

In a 149-page report prepared for President Trump, the US Treasury has called for the repeal of Section 1071 of Dodd-Frank. Section 1071 is the governing law behind the CFPB’s jump into small business lending data collection. Citing the cost of data collection and anemic small business loan growth since 2008, the Treasury says, “Although […]

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New York State Assembly Proposes Online Lending Task Force

June 5, 2017
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Albany, NY - Capitol Building

On June 2nd, the New York Assembly drafted its answer to the recent joint-committee hearing on online lending. It’s called Bill A8260, an ACT to establish a task force on online lending institutions. As it’s proposed now, the task force would include individuals from the online lending community, the small business community, the financial services […]

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