Small business financers and brokers (“providers”) active in New York are officially on notice to finalize their preparations to comply with New York’s Commercial Finance Disclosure Law (“CFDL”) by August 1, 2023, the new effective date provided in final administrative regulations just issued on February 1 by the New York Department of Financial Services (“NYDFS”).

Eric T. Mitzenmacher
Legal Update: Iowa Targets Out-of-State Bank Partner for Usury, Shedding Light on State’s Interpretation of DIDMCA Opt-Out
State-chartered banks lending to Iowa residents will want to take note of an Assurance of Discontinuance entered into in December between the State of Iowa and an out-of-state bank to settle claims that the bank charged usurious rates of interest to Iowa consumers. The settlement also highlights the Iowa Attorney General’s interpretation of the state’s…
Legal Update: CFPB Preliminarily Determines State Commercial Financing Disclosure Laws Not Preempted by Truth in Lending Act
Small business lenders hoping for federal intervention will be disappointed to learn that the Consumer Financial Protection Bureau (“CFPB”) has reached a preliminary determination that New York’s new commercial financing disclosure law is not preempted by the federal Truth in Lending Act (“TILA”). The CFPB’s public notice indicates that it initially takes the same view…
Legal Update: Marketplace Lender’s Suit Challenges “True Lender” Recharacterization by California DFPI
Marketplace lender Opportunity Financial, LLC (“OppFi”) has gone on the offensive against the California Department of Financial Protection and Innovation (“DFPI”) to protect its bank partnership program against challenge on a “true lender” theory. On March 7, 2022, OppFi filed suit against the DFPI to ask the state court to declare that FinWise Bank, a…
Illinois Imposes Strict 36% Usury Cap for a Range of Consumer Finance Products and Providers
On March 23, 2021, Illinois Governor JB Pritzker signed into law Senate Bill 1792, enacting the Predatory Loan Prevention Act (PLPA) and capping interest at an “all-in” 36% APR (similar to the Military Lending Act’s MAPR) for a variety of consumer financing, effective immediately. The PLPA uses an expansive definition of interest for the usury…
Congress Prepares to Invalidate OCC’s True Lender Rule
On Thursday (March 26, 2021), Senator Chris Van Hollen (D-MD) introduced a Congressional Review Act (CRA) resolution of disapproval to invalidate the Office of the Comptroller of the Currency’s (OCC) true lender rule. The resolution is co-sponsored by Senate Banking Committee Chair Sherrod Brown (D-OH) and Senators Jack Reed (D-RI), Elizabeth Warren (D-MA), Catherine Cortez-Masto…
The OCC Finalizes “Madden Fix” Regulation, Codifying the “Valid-when-Made” Doctrine as Applicable to Loans Made by National Banks and Federal Savings Associations
On Friday, the United States Office of the Comptroller of the Currency (“OCC”) finalized a regulation regarding the “Permissible Interest on Loans that are Sold, Assigned, or Otherwise Transferred” by national banks and federal savings associations. Initially proposed in November 2019, the regulation provides that interest on a loan that is permissible under provisions of…
Debt Collection During and After the Pandemic: Do Certain US Legislators and Agencies Seek a Debt Collection Ice Age?
On May 15, House Democrats passed on the Heroes Act, a $3 trillion package that revives, among other things, many of the severe debt collection-related restrictions House Democrats have been pushing since the start of the pandemic. Although the Heroes Act has no promise of becoming law, the Act, combined with other federal and state…
U.S. Federal Reserve Expands and Provides Additional Details on Main Street Lending Program for Small and Mid-Sized Businesses
On April 30, 2020, the Federal Reserve Board announced expanded loan offerings and terms for the forthcoming Main Street Lending Program. Among other changes, Main Street is now open to larger businesses with up to 15,000 employees or $5 billion in 2019 annual revenue (previously up to 10,000 employees or $2.5 billion in 2019 annual…
PPPLF Now Open to Non-Banks and for Purchased PPP Loans
The Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) is now available to non-bank PPP lenders to finance Paycheck Protection Program (“PPP”) loans that they originated or purchased. While the PPPLF was previously only available to depository institutions to finance PPP loans that they originated, the Federal Reserve revised its eligibility criteria on April 30, 2020 to provide funding to all Small Business Administration (“SBA”) approved lenders.[1] Terms of the PPPLF are discussed in our earlier blog post.
…
Continue Reading PPPLF Now Open to Non-Banks and for Purchased PPP Loans