After (Another) Unusual Year, We’re Very Thankful and Wish You a Happy ThanksgivingNow that the pandemic’s “social distancing” is lessening, we hope you are all able to gather with friends and family this Thanksgiving. As we do the same, we wanted to count our blessings as we review the year. This year, we are thankful for being able to return to our offices, our favorite restaurants, and

CFPB Action Against Student Loan Originator Sends Message to Income Share Agreement IndustryOn September 7, 2021, the CFPB issued a consent order against Better Future Forward, Inc., and related entities (collectively, BFF), companies that provide financing for postsecondary education to students via income share agreements (ISAs). In this enforcement action, the CFPB found that BFF falsely represented that ISAs do not create debt and are not loans

District Court Ruling Clears Way for Small Dollar Rule Compliance Date in June 2022Yesterday, in Community Financial Services Association of America, Ltd. v. Consumer Financial Protection Bureau, a lawsuit involving implementation of the payment provisions of the Payday, Vehicle Title, and Certain High-Cost Installment Loans Regulation (the “Small Dollar Rule”), the district court ruled on the Consumer Financial Protection Bureau’s (CFPB) and the Community Financial Services Association’s

The CFPB at 10 Years: A Look Back and a Look AheadOver the years, we have followed actions of the Consumer Financial Protection Bureau (CFPB) and published information that can be found on our Financial Services Perspectives blog. Now that the 10-year anniversary of the CFPB opening its doors has passed, let’s take a look back at where it started and where it may be

Illinois Caps Consumer Loans at 36% Rate, Limiting Consumers’ Access to CreditLast week, Illinois enacted the “Predatory Loan Prevention Act” (SB 1792), which would place a 36% rate cap on nearly all non-bank consumer loans. This act will essentially outlaw small-dollar loans in Illinois and may make ancillary products on auto loans, such as GAP insurance, unavailable for a large number of consumers. The act

The Consumer Financial Protection Bureau Issues Statement Regarding Small Dollar Lending and Signals Return to Prior PolicyOn March 23, 2021, the CFPB issued a brief statement highlighting its position regarding “consumer harms in the small dollar lending market” and likely future action to reverse the previous CFPB administration’s policy regarding the industry. The next day, the CFPB provided its Consumer Response Annual Report for 2020 to Congress, which stated the complaint

Florida Court Affirms That Merchant Cash Advance Product Not Subject to Usury StatuteThis month, a Florida appellate court held that a merchant cash advance (MCA) purchase and sale agreement was not a “disguised loan” and, therefore, was not subject to Florida’s criminal usury statute. MCA purchase and sale agreements, which offer merchants a fast and efficient way to obtain funding for their operations, are not loans. Rather,

New York Enacts Small Business Truth in Lending Disclosure Requirement Affecting Small Business Loans, MCAs, and Other Forms of Business FinanceA new year brings new compliance requirements for non-banks and fintechs conducting business in New York, including Merchant Cash Advance (MCA) companies. On December 23, 2020, New York Gov. Andrew Cuomo signed SB5470 expanding the New York Financial Services law to require non-banks and fintechs to provide small businesses with lending disclosures similar to those

In the Strangest Year Ever, We’re Very Thankful and Wish You a Happy Thanksgiving

As everyone steps away from their (home) office to celebrate Thanksgiving, we wanted to count our blessings as we review this truly remarkable and unusual year. In addition to frontline healthcare workers, good WI-FI, food delivery services, and finally finding a mask that is comfortable, we are also thankful for the following:

1. The CARES

State Attorneys General Challenge FDIC’s Madden FixIn early August 2020, several state attorneys general filed suit against the Office of the Comptroller of the Currency (OCC) challenging the OCC’s proposed “Madden Fix.” Notably, while the Federal Deposit Insurance Corporation (FDIC) also issued their own Madden Fix, the agency was not named as a defendant in the initial lawsuit. As such,