Articles by Patrick Siegfried

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Court Refuses to Apply Federal Preemption to Loan Servicer Despite Bank’s Continued Interest in Loan

January 20, 2016
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usury preemption

In November 2014, the Pennsylvania Office of Attorney General (“OAG”) filed a complaint against a number of companies that did business with a group of payday lenders. The payday lenders were a Delaware bank and three tribal entities. The defendants provided marketing services and operational support to the lenders and in some instances purchased portions […]

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When it Comes to Usury Law, Be Careful What You Ask For

January 8, 2016
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California Lending

In a previous post, Creditor Fails to Navigate Usury Law “Minefield”, Ordered to Refund $1.3 Million to Debtor, I discussed a recent bankruptcy case in California. In the case, a lender had filed a claim in the borrower-debtor’s bankruptcy case. The debtor objected to the claim and brought a usury claim against the lender for […]

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California Finance Lenders Push Legislative Agenda in Response to Growth of Alternative Small Business Finance Industry

December 8, 2015
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law books

On October 10, 2015, California Governor Jerry Brown signed into law SB 197, a bill that allows licensed California finance lenders to pay commissions to unlicensed persons that refer prospective commercial loan borrowers to licensees that offer certain types of lower cost loans. The bill was co-sponsored by Opportunity Fund and the California Association for […]

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CFPB Officially Begins Work on Small Business Data Collection Rule

November 23, 2015
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consumer protection

On Friday, the CFPB issued its semiannual update to its rulemaking agenda. The agenda lists the Bureau’s major current and long-term initiatives. Long listed as a long-term item, the Small Business Data Collection rule required by section 1071 of Dodd-Frank is listed on the update as a current initiative. The move is unsurprising given the […]

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FDIC Issues Guidance that May Curtail Bank Purchases of Marketplace Loans

November 20, 2015
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bank vault

On November 6, the Federal Deposit Insurance Corporation (FDIC) issued Financial Institution Letter FIL-49-2015, titled “Advisory on Effective Risk Management Practices for Purchased Loans and Purchased Loan Participations.” Though billed as an update to an advisory letter issued in 2012, the new guidance requires all FDIC-supervised banks and savings associations to implement a number of […]

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Top Lawmakers Request Information About Online Small Business Lending

November 16, 2015
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US Senate

In the past two weeks, four ranking members of Congress have sent letters to the Treasury Department, SBA, SEC and CFPB requesting information about alternative small business lending. On November 3, Senators Jeff Merkley (D-OR), Sherrod Brown (D-OH) and Jeanne Shaheen (D-NH) sent a letter to the Treasury Department and the SBA requesting information about […]

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Treasury Official Discusses Responses to RFI, Offers Mixed Review of Alternative Small Business Lending

November 3, 2015
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Treasury Department

Antonio Weiss, Counselor to the Secretary of the US Treasury, recently spoke at the Information Management Network Conference on Marketplace Lenders. In his prepared remarks, Mr. Weiss discussed the comments Treasury had received in response to its Request for Information about marketplace lenders. Mr. Weiss highlighted a number of themes about alternative small business finance […]

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A Student Cash Advance?

October 27, 2015
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Some interesting legislation was introduced last Tuesday by Senator Marco Rubio. The bill entitled “Investing in Student Success Act of 2015” would allow individuals to enter into Income Share Agreements that bear some of the characteristics of merchant cash advances. The bill defines an Income Share Agreement as, [A]n agreement between an individual and any […]

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Lenders Subject to Section 1071 of Dodd-Frank May Find Silver Lining in CFPB’s Roll Out of New HMDA Rules

October 23, 2015
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plenty of time

Last week, the CFPB finalized its update to the reporting requirements of the Home Mortgage Disclosure Act (HMDA) regulations. Under the new rules, the CFPB expects that the number of non-depository institutions that will be required to report may increase by as much as 40 percent. This will lead to a sizable increase in the […]

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Former SBA Administrator Applauds Growth of Alternative Small Business Lending, Says Loan Brokers are Under Watch by Regulators

October 21, 2015
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industry being watched

Former SBA Administrator Karen Mills spoke at the LendIt Europe Conference yesterday. The title of her speech was “The State of Small Business Financing in the U.S.” In her talk, Ms. Mills summarized the negative effects that the last economic recession had on small business lending in the U.S. and how alternative small business lenders […]

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