Financial Institution Regulation

Fintech lender Opportunity Financial (“OppFi”) and the Department of Financial Protection and Innovation (“DFPI”), California’s financial-services regulator, filed dueling claims as they battle over state efforts to enjoin the company’s branded loans, which exceed California’s 36% interest-rate cap. This is the latest effort by fintech lenders to cement the True Lender Rule against state opposition.

Continue Reading Opportunity Financial’s Lawsuit Against California’s Financial-Services Regulator Signals Continued Fight Over “True Lender” Principles

Blockchain regulation continues to be the topic du jour, with increasing scrutiny from government agencies across the board. The latest comes from the New York State Department of Financial Services (DFS), which has been a leader in the space since the 2015 “BitLicense” framework under the New York Financial Services Law. On April 28, 2022, new DFS Superintendent Adrienne A. Harris issued fresh guidance encouraging cryptocurrency companies to adopt blockchain analytics tools as a best practice.

Continue Reading New York State Department of Financial Services Takes Aim at Blockchain Entities Circumventing Sanctions on Russia

Reflecting its determination to monitor the crypto markets, the Security and Exchange Commission has renamed the Cyber Unit the “Crypto Assets and Cyber Unit” and is nearly doubling its size from  30 to 50 members, according to a May 3 press release from the agency. The additional permanent positions will include investigative staff attorneys, trial

On April 25, the Consumer Financial Protection Bureau announced that it will begin examining nonbank “covered persons” that it has determined pose risks to consumers. What is most striking about the announcement is not that the CFPB will start examining this category of nonbanks — it’s had that authority since its inception — but that

On March 31, 2022, the Federal Deposit Insurance Corporation (FDIC) issued the March 2022 edition of its Consumer Compliance Supervisory Highlights. The publication provides a high-level overview of consumer compliance issues identified in 2021 through the FDIC’s supervision of state-chartered banks and thrifts that are not members of the Federal Reserve System.  It provides important guidance regarding compliance priorities for these financial institutions.

Continue Reading FDIC Consumer Compliance Supervisory Highlights for State and Community Banks

Jeff Ehrlich

McGuireWoods is pleased to announce that Jeff Ehrlich, former deputy enforcement director at the Consumer Financial Protection Bureau, has joined the firm’s financial services litigation practice as a partner in Washington, D.C.

Jeff joined the CFPB in 2011 and was promoted to deputy enforcement director in 2013. In that role, he led the CFPB’s

On March 9, 2022, President Biden signed an Executive Order on Ensuring Responsible Development of Digital Assets (“Executive Order”) to mobilize the federal government to develop a strategy for digital assets, intending to encourage innovation in a manner that mitigates the risks to consumers, investors, and businesses. The Executive Order mandates an interagency approach across several executive departments and federal agencies to conduct reports and analyses on key issues impacting digital assets, including consideration of U.S. Central Bank Digital Currencies (“CBDC”). The Executive Order identifies six primary policy objectives:

  1. protect U.S. consumers, investors, and businesses;
  2. protect U.S. and global financial stability and mitigate systemic risk;
  3. mitigate the illicit finance and national security risks posed by misuse of digital assets;
  4. reinforce U.S. leadership in the global financial system and in technological and economic competitiveness;
  5. promote access to safe and affordable financial services; and
  6. support technological advances that promote responsible development and use of digital assets.


Continue Reading Federal Framework for Digital Asset Regulation Comes into Focus

In late January 2022, the Federal Reserve released “Money and Payments: The U.S. Dollar in the Age of Digital Transformation,” its much-anticipated discussion paper on central bank digital currencies (CBDCs). In the paper, the Federal Reserve provides a framework and summary of its initial analysis on the potential adoption of a U.S. CBDC and invites the public and other stakeholders to provide their views. The paper does not advance a specific policy outcome or signal any imminent action; rather, it marks an important first step in public debate and engagement on the issue of CBDCs.

Continue Reading Fed: Let’s Talk Central Bank Digital Currencies

How to provide financial services to limited-English proficiency (“LEP”) consumers has become a pressing legal issue. Both federal and state laws provide requirements and limitations regarding translations of financial documents. Earlier this year, the Consumer Financial Protection Bureau (“CFPB”) published a comprehensive statement encouraging financial institutions to provide services to LEP consumers. The CFPB also took enforcement action against a company for, among other things, deceptively marketing to Spanish-speaking consumers. Following the trend to protect LEP consumers, a new Nevada law, effective October 1, 2021, makes it a deceptive practice to not  provide translations for certain financial contracts, agreements and disclosures (“Nevada Law”).

Under the Nevada Law, enacted as Assembly Bill No. 359, any person, who in the course of business, advertises and negotiates certain transactions in a language other than English must provide a translation of the contract or agreement that results from the advertising and negotiations. The translation must include every term and condition of the contract or agreement.

Continue Reading New Nevada Law Protects Limited-English Proficiency Consumers by Requiring Translation of Certain Financial Legal Documents

On July 12, 2021, the Board of Governors of the Federal Reserve System (Board), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) proposed interagency guidance on how banks should manage third-party relationships, including partnerships with fintech companies. The proposal would offer a framework for banks when developing risk management practices for their third-party relationships, taking into account the level of risk, complexity, size of the organization, and the nature of the third-party relationship.

Continue Reading Bank Regulators Propose Interagency Guidance on Fintech Partnerships