lending – FinTech and Blockchain Law Watch

10 Impactful Provisions of the Lummis-Gillibrand Bill

Jun 07 2022

By Andrew Hinkes, Eden Rohrer, and Judie Rinearson

The “Lummis-Gillibrand Responsible Financial Innovation Act,” announced this morning, lays out a bold agenda for legal reform across multiple regulatory regimes aimed at clarifying legal requirements for regulated entities to issue, trade, and provide services related to certain digital assets. Although a point by point summary of the 69 page bill is beyond the scope of this post, here’s a brief summary of 10 impactful provisions from the Bill:

Potential Major Change for U.S. Prepaid Products: Paypal vs CFPB Court Vacates Two Significant Restrictions in CFPB’s Prepaid Account Rule

Jan 13 2021

By Judith Rinearson, Andrew C. Glass, Gregory N. Blase, and Hollee M. Boudreau

On 30 December 2020, the United States District Court for the District of Columbia entered an order invalidating two provisions of the “Prepaid Account Rule” (the Rule) promulgated by the Consumer Financial Protection Bureau (CFPB). Specifically, the order invalidated the Rule’s mandatory short form disclosure requirement and the requirement for a thirty-day delay before linking prepaid products to credit, on the basis that the CFPB had exceeded its statutory authority.¹

Who bears the risk? Federal Court holds that a purchaser of unsecured consumer loans is the “true lender”

Sep 09 2016

By Irene C. Freidel and David D. Christensen

A California federal court has held that the purchaser of consumer loans is the “true lender” and thus subject to state usury laws, even though a separate entity funded and closed the loans in its own name. The recent decision, however, is another reminder that US state and federal regulators, as well as plaintiffs’ attorneys, may be able to pierce these partnerships where the financial institution funding and closing the loan does not bear substantial risk on those loans.

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