00:00.539 --> 00:03.269
Johny Fernandez: You know what I
am surprised about though. I am

00:03.269 --> 00:08.759
surprised about this of Virginia
hopping on the bandwagon of

00:10.319 --> 00:12.269
commercial finance EPR
disclosures?

00:12.810 --> 00:13.980
Sean Murray: Yes, that's right.

00:13.980 --> 00:16.330
Johny Fernandez: That's what I'm
shocked about. Because it's

00:16.330 --> 00:19.420
coming. What I'm starting to
see, we've talked about this

00:19.630 --> 00:23.770
last year. And now that it seems
like certain states are starting

00:23.770 --> 00:28.000
to like, really, what's your
smile? I don't know. What's the

00:28.000 --> 00:33.610
word? I'm sorry. He's just
smiling at me.

00:33.960 --> 00:36.150
Sean Murray: I don't know. Yeah,
I don't know. Yeah, no, but I'm

00:36.150 --> 00:39.120
still I still can't get over
whether I want to find out. When

00:39.120 --> 00:42.030
I give my two cents on this
bill. I want to find out if you

00:42.030 --> 00:44.220
were, if you're shocked

00:44.220 --> 00:47.360
Johny Fernandez: That you are.
I'm not surprised that you were

00:47.360 --> 00:54.170
shocked okay. But on a serious
note, Virginia's pretty much

00:54.170 --> 00:57.200
gonna piggy you. It's joining
the bandwagon of what New York

00:57.200 --> 00:59.120
is doing? Yeah, we're you
shocked?

00:59.360 --> 01:03.350
Sean Murray: Was I shocked. So I
don't know that I would if I was

01:03.350 --> 01:09.380
necessarily shocked yet, because
the bill is in such early stages

01:09.380 --> 01:12.860
that from what I understand, it
only has one sponsor. Okay, so

01:12.860 --> 01:15.680
the bill is going to have a lot
of legs to it. From the very

01:15.680 --> 01:17.840
beginning, you usually have
several sponsors who are all

01:17.840 --> 01:20.000
like, yes, I want my name
attached to it from the

01:20.000 --> 01:22.970
beginning. So that, you know, it
becomes my bill and your bill

01:23.000 --> 01:25.940
going around. And you know, and
say that this was our signature.

01:25.940 --> 01:28.730
You know, this is our one of our
signature achievements of this

01:28.730 --> 01:31.670
future ones. Yeah, I've only
seen one sponsor attached to the

01:31.670 --> 01:34.580
bill. I don't even think it's
even gone into any committees

01:34.580 --> 01:37.670
yet. So we're talking about
super early stages. But the

01:37.670 --> 01:40.610
reason we reported on it is
because it's good to know that

01:40.610 --> 01:43.820
these things are in the works
from the very beginning, because

01:43.820 --> 01:46.760
as we saw in New York, even
though we reported on its

01:46.760 --> 01:51.290
progress along the way, people
people were still shocked when

01:51.290 --> 01:54.380
it actually passed. In fact,
when we reported that it passed,

01:54.380 --> 01:58.220
and these were the ramifications
some people told us, we must be

01:58.220 --> 02:00.770
lying cause they had not heard
anything about it, even though

02:00.770 --> 02:03.710
we've talked about it for
months. So, you know, what else

02:03.710 --> 02:05.960
can we do? Other than bring it
to people's attention? That's

02:05.990 --> 02:11.870
all we do. We report the news. A
member of the Virginia's state

02:11.870 --> 02:17.030
legislature did introduce a bill
on commercial financing, APR

02:17.030 --> 02:20.000
disclosure. It's not as
comprehensive as the New York

02:20.000 --> 02:22.460
one. It's like, it's like a
trimmed down stripped down

02:22.460 --> 02:27.050
version. Yeah, that focuses
entirely on sales based

02:27.050 --> 02:30.590
financing, otherwise known as
revenue based financing, or as

02:30.590 --> 02:33.170
some people call it merchant
cash advance. So it's targeting

02:33.200 --> 02:35.330
one very specific thing.

02:35.490 --> 02:37.920
Johny Fernandez: So we want to
get even more specific. It's

02:37.920 --> 02:42.330
Virginia, Virginia House Bill
1027. And it's aimed squarely at

02:42.330 --> 02:44.580
sales based financing provided.

02:44.600 --> 02:46.430
Sean Murray: Yeah, so that's the
term of use sales based

02:46.430 --> 02:49.340
financing. That's been the key
word in a lot of the in a lot of

02:49.340 --> 02:53.870
the state proposals, sales based
financing. They're basically

02:53.870 --> 02:56.120
saying, if you're taking a if
you're looking at someone's

02:56.120 --> 02:58.400
revenue, and you're buying
buying some of their future

02:58.400 --> 03:01.580
sales, or taking a percentage of
your future revenue, as

03:01.580 --> 03:04.820
repayment that this counts as
sales based financing, that's

03:04.820 --> 03:09.290
aimed very specifically at one
area of the finance market. And

03:09.290 --> 03:11.870
that's where that's where at
least one Virginia state

03:11.870 --> 03:15.320
legislator has, you know, put
their attention on, we'll see

03:15.320 --> 03:18.110
what happens to it could be
nothing. But I don't want to not

03:18.110 --> 03:21.020
tell people, if we know it's in
the works, because the earlier

03:21.020 --> 03:23.030
you know about something, the
better. So we don't end up with

03:23.030 --> 03:26.090
a New York situation where the
bill passes. Everyone says that

03:26.090 --> 03:28.520
can't be I've never heard of it.
So that's, that's what's going

03:28.520 --> 03:29.150
on in Virginia.

03:29.180 --> 03:30.770
Johny Fernandez: Yeah. And
speaking of New York, I know,

03:30.770 --> 03:33.440
it's one of those things that
even the New York regulators,

03:33.440 --> 03:37.430
they also saw that, like the,
the, you know, what they've

03:37.430 --> 03:40.970
introduced is, is still weak. I
mean, it's not one of those

03:40.970 --> 03:43.310
things that, you know, they have
everything figured out, the

03:43.310 --> 03:46.580
language is great. There's still
a lot of questions regarding

03:46.580 --> 03:49.970
that, and, and how it's going to
affect the business. And like,

03:50.150 --> 03:52.760
you know, I think the one thing
that keeps coming to mind,

03:52.760 --> 03:55.190
right, when I think about the
New York bill is like, if you

03:55.190 --> 03:58.040
live in Florida, and there's a
transaction in New York and your

03:58.040 --> 04:02.030
deal touches New York, do you
still technically get impacted

04:02.030 --> 04:05.660
even if like, you know, it's
like things like that like? And

04:05.660 --> 04:08.180
then the other thing, were the
comments, you know, in New York,

04:08.180 --> 04:10.160
like, again, the bill has
passed, but it's still

04:10.160 --> 04:11.930
technically weak, because
there's still a lot of

04:11.930 --> 04:14.300
questions. And I think that's
what's interesting about the

04:14.300 --> 04:17.720
Virginia law, even though it's
still fairly new,

04:17.840 --> 04:19.610
Sean Murray: It's just a bill.
It's just a it's just an idea.

04:19.640 --> 04:24.080
Johny Fernandez: It's an idea
that they are probably looking

04:24.080 --> 04:27.260
at Maryland, they're probably
going to New York and kind of

04:27.440 --> 04:30.830
seeing how that's resulted. And
clearly that hasn't resulted in

04:30.830 --> 04:34.040
the best for the for them,
because a lot, there's still a

04:34.040 --> 04:36.260
lot of questions for everything.

04:36.260 --> 04:38.170
Sean Murray: Yeah, you bring up
a really good point, because

04:38.217 --> 04:41.127
here you have Virginia copying
and pasting huge segments of the

04:41.173 --> 04:44.083
New York, of the New York law.
I'm like, we'll do that too. But

04:44.129 --> 04:46.485
New York would have benefited
from a lot of earlier

04:46.531 --> 04:49.349
correspondence with people who
it was going to affect because

04:49.395 --> 04:52.305
what are they have, as you just
said, it's weak and people have

04:52.351 --> 04:55.215
all these questions, weak in the
terms of nobody knows how you

04:55.261 --> 04:58.079
know who it applies to is just
our theres a lot of questions.

04:58.125 --> 05:01.081
It's too ambiguous. And so what
did New York regulators do? They

05:01.127 --> 05:03.899
actually said, Oh, I know we'll
just call another state that

05:03.945 --> 05:06.763
implemented something similar.
So they call the regulators in

05:06.809 --> 05:09.765
California, who passed their own
disclosure bill like four years

05:09.811 --> 05:12.675
ago. And they said, Well, what
did you guys do? And they said,

05:12.721 --> 05:15.493
We didn't know what to do. We
couldn't fix this thing. We've

05:15.539 --> 05:18.310
been working on it for four
years, New York is like, you got

05:18.357 --> 05:21.174
to be kidding me. Right? Four
years, you had you had had this

05:21.221 --> 05:24.038
on your desk, you wouldn't able
to figure it out. We're stuck

05:24.084 --> 05:26.856
with implementing this, like in
a week from now. Never gonna

05:26.902 --> 05:29.304
happen. So they delayed the
bill, then then you have

05:29.350 --> 05:32.260
Virginia saying, oh, we'll, copy
New York, but New York doesn't

05:32.306 --> 05:34.847
know what to do. California
didn't know what to do. And

05:34.893 --> 05:37.665
nobody knows what to do. But
everyone's creating bills to do

05:37.711 --> 05:40.528
oh, we need to disclose. But it
seems like people would these

05:40.575 --> 05:43.438
states, not saying that their
initiatives are bad or acting in

05:43.485 --> 05:45.979
bad faith, but they it seems
like they would certainly

05:46.025 --> 05:48.981
benefit from communicating with
the party that's going to impact

05:49.028 --> 05:51.938
from the very beginning, before
they passed the law. Because we

05:51.984 --> 05:54.801
as we're seeing so far the law
gets passed, and then everyone

05:54.848 --> 05:56.280
say, Oh, this isn't gonna work.

05:56.310 --> 05:58.980
Johny Fernandez: Yeah, no, it's
true. I think one of the things

05:58.980 --> 06:02.400
that was very, very interesting
was that, you know, for one of

06:02.400 --> 06:07.020
these meetings that you know,
they have, they were asking, you

06:07.020 --> 06:11.040
know, the leaders, you know, the
state leaders, and a lot of the

06:11.040 --> 06:13.590
state leaders are like, confused
themselves, like, what does this

06:13.590 --> 06:16.920
mean? Or like, what is the
verbiage of this are just,

06:16.950 --> 06:18.960
they're just trying to
understand the gauge of the

06:18.960 --> 06:21.570
entire industry, and they don't
even know. And it's like,

06:21.930 --> 06:24.690
there's a lot of unknowns, it's
across the board,

06:24.720 --> 06:26.880
Sean Murray: You can't pass it
can't pass the law and not know

06:26.880 --> 06:30.120
anything. Not understanding it,
it's, you really need to

06:30.120 --> 06:33.660
understand, talk to the relevant
people, you will find if you're

06:33.660 --> 06:35.580
out there and your a regulator
and your watching, you will find

06:35.610 --> 06:39.090
that so many people involved in
this industry, are very

06:39.090 --> 06:42.060
interested in passing some sort
of regulation to address the

06:42.060 --> 06:45.150
issues that you are, are
concerned with. Yeah. Which is

06:45.150 --> 06:47.970
great news, because they're not
combative. They're not opposed

06:47.970 --> 06:50.730
to something, right. But it
seems like from what we've

06:50.730 --> 06:53.910
gathered, it would it would, it
would serve everyone's interests

06:53.910 --> 06:56.430
better if there was
communication a lot more early

06:56.490 --> 06:59.220
in the process, so that we don't
end up with situations where

06:59.220 --> 07:01.470
there are laws passed, and then
no one knows what to do.

07:01.540 --> 07:02.980
Johny Fernandez: And I think the
other thing that's interesting

07:02.980 --> 07:06.760
is that the communication not
only has to be within the area

07:06.790 --> 07:10.300
of state leaders, but also to
the constituents that, you know,

07:10.330 --> 07:13.300
want to chime in or like, like
in New York, it's like, hey,

07:13.300 --> 07:16.840
let's open up the comments area.
And then everyone's like, oh, we

07:16.840 --> 07:19.180
didn't even know, like, we even
know that was happening. We

07:19.180 --> 07:21.460
didn't know where to go. And we
didn't know there was a

07:21.460 --> 07:24.940
deadline, the deadline passed.
So it's like, at the end of the

07:24.940 --> 07:26.950
day, it's just a big clustered
mess,

07:26.990 --> 07:28.940
Sean Murray: Isn't it? It's so
weird. That's their hey, let's

07:28.940 --> 07:33.410
open it up to comments after the
law is passed. And like, oh,

07:33.680 --> 07:36.290
like ah, and you've done this
before the law was passed. Now

07:36.290 --> 07:38.780
the law has already passed. And
then like they take comments.

07:38.780 --> 07:41.060
Hey, what do you guys think of
this? Oh, it's not gonna work.

07:41.150 --> 07:42.110
Oh, it's already the law.

07:43.260 --> 07:45.585
Johny Fernandez: So it's
interesting. I'm definitely

07:45.651 --> 07:49.571
gonna be interested in I say
this all the time about what's

07:49.638 --> 07:53.691
gonna be happening in Virginia
because I want to see how this

07:53.757 --> 07:55.020
is going to evolve.

07:55.560 --> 07:58.110
Sean Murray: Yeah, and I we will
keep everyone updated as to

07:58.110 --> 08:00.630
whether or not one of us is
shocked by the developments,

08:00.650 --> 08:03.020
Johny Fernandez: You know, maybe
I'm not gonna be shocked. Are

08:03.020 --> 08:05.210
you gonna be shocked? We'll find
out find out in

08:05.210 --> 08:08.030
Sean Murray: Tune in tune in for
my reaction. And Johnny's

08:08.030 --> 08:08.900
analysis of it