Alternative Finance
Practice Overview
Alternative finance addresses financing activity that takes place outside of the traditional banking system, such as payday loans, auto title loans, check cashing services, and often through the numerous emerging fintech companies. Buckley has long-standing experience with such products, including involvement from the inception of retail payday lending — representing the first movers in that space in litigation and regulatory matters even before the enactment of specific laws addressing payday lending. Our attorneys navigate clients and investors through the challenges of payday loans, auto title installment loans, deposit advance, and similar products. We work with our clients to address and adapt to changing regulatory expectations and federal and state legislative developments.
Our firm provides legal counsel regarding supervisory and enforcement matters with the Consumer Financial Protection Bureau (CFPB) and state banking departments. We also perform transactional due diligence of alternative finance for investors and other counterparties. As needed, we are effective advocates who defend alternative finance providers and their officers and directors in class actions and governmental enforcement actions.
Representative work includes:
- Represent payday lenders in CFPB supervisory and enforcement matters relating to a variety of business models (single-state license/choice-of-law, multiple-state license, online, tribal, and offshore)
- Advise payday lenders regarding state regulatory inquiries regarding possible violations of state law
- Perform acquisition due diligence of alternative finance companies offering payday loans, installment loans, title loans, gold buying, and check cashing services
- Defended a payday lender in a class action alleging unfair and deceptive trade practices and usury violations
- Represented a payday lender in a Federal Trade Commission (FTC) investigation regarding privacy and information security issues
Articles
"Equipment finance: Understanding licensing obligations" by Kathryn L. Ryan, Moorari K. Shah, and Frida Alim (Equipment Leasing & Finance Magazine)
Licensing Considerations, Generally The applicability of state licensing laws may depend on multiple factors, including transaction structures, business entity types and whether the activities are appropriately classified as “commercial” or another type of non-consumer transaction. Although the...
Articles
News & Blogs
CFPB publishes fall 2019 rulemaking agenda
On November 20, the Office of Information and Regulatory Affairs released the CFPB’s fall 2019 rulemaking agenda . According to a Bureau announcement , the information released represents regulatory matters it “reasonably anticipates having under consideration during the period from October 1, 2019...
InfoBytesDistrict Court certifies payday lending class action
On October 31, the U.S. District Court for the District of New Jersey certified two classes of consumers alleging a payday lender and its subsidiaries charged usurious, triple-digit interest rates on short-term loans originated by a nonparty entity run by a member of a federally recognized Indian...
InfoBytesKraninger discusses semi-annual report at House and Senate hearings
On October 17, CFPB Director Kathy Kraninger testified at a hearing held by the Senate Banking Committee on the CFPB’s Semi-Annual Report to Congress. (Previous InfoBytes coverage here .) Pursuant to the Dodd-Frank Act, the hearing covered the semi-annual report to Congress on the Bureau’s work...
InfoBytesCalifornia caps rate on installment loans
On October 10, the California governor signed AB 539 , known as the “Fair Access to Credit Act,” which amends the California Financing Law (CFL) to limit the rate of interest on certain installment loans. Specifically, for installment loans with a principal amount between $2,500 and $10,000,...
InfoBytesCSBS seeks comments on money services businesses model law
On October 1, the Conference of State Bank Supervisors (CSBS) issued a request for comments on its Draft Model Law Language for money services businesses (MSBs). According to CSBS, state regulation of MSBs is a primary part of Vision 2020—a state regulator initiative to modernize the regulation of...
InfoBytesCFPB and South Carolina take action against loan broker for veteran pension loans
On October 1, the CFPB and the South Carolina Department of Consumer Affairs filed an action in the U.S. District Court for the District of South Carolina against two companies and their owner, alleging that the defendants violated the Consumer Financial Protection Act (CFPA) and the South Carolina...
InfoBytesNCUA approves additional payday loan alternative
On September 19, the NCUA announced the approval of a final rule creating a new payday alternative loan product (PAL II). As previously covered by InfoBytes , in June 2018, NCUA proposed the PAL II as an additional offering to the current payday alternative loan product (PAL I), which has been...
InfoBytesNew York says creditors prohibited from obtaining confessions of judgments against out-of-state borrowers
On August 30, the New York governor signed S 6395 , which prohibits creditors from obtaining confessions of judgments through the New York court system against individuals and businesses located outside of the state in order to seize borrower assets. According to a press release issued by Governor...
InfoBytes11th Circuit: Payday lenders’ agreements unenforceable under Georgia policy
On August 28, the U.S. Court of Appeals for the 11th Circuit held that a district court did not err when it denied a group of lenders’ motion to dismiss class action claims alleging that their loan agreements violated Georgia’s Payday Lending Act (PLA), the Georgia Industrial Loan Act (GILA), and...
InfoBytesIllinois updates Consumer Installment Loan Act and Payday Loan Reform Act
On August 23, the Illinois governor signed SB 1758 , which amends the state’s Consumer Installment Loan Act and the Payday Loan Reform Act. Generally, payday loans must be repayable in substantially equal and consecutive installments. The amendment clarifies that a “‘substantially equal installment...
InfoBytes
Our Alternative Finance Team
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Recent Blog Posts
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November 22, 2019
CFPB publishes fall 2019 rulemaking agenda
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November 6, 2019
District Court certifies payday lending class action
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October 24, 2019
Kraninger discusses semi-annual report at House and Senate hearings
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October 16, 2019
California caps rate on installment loans
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October 4, 2019
CSBS seeks comments on money services businesses model law