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
OCC praises CFPB’s payday rule proposal
On February 11, the OCC released a statement from Comptroller of the Currency Joseph Otting supporting the CFPB’s proposed rule rescinding certain requirements relating to underwriting standards for short-term small-dollar loans. (Covered by InfoBytes here .) Calling the proposal “important and...
InfoBytesCFPB announces settlement with payday lending operation
On February 6, the CFPB announced a settlement with an Indiana-based payday retail lender and affiliates (companies) in seven states to resolve alleged violations of the Consumer Financial Protection Act (CFPA), Truth in Lending Act (TILA), and Gramm-Leach-Bliley Act (GLBA) privacy protections. The...
InfoBytesCFPB proposes to rescind ability-to-repay standards in payday rule
On February 6, the CFPB released two notices of proposed rulemaking (NPRM) related to certain payday lending requirements under the agency’s 2017 final rule covering “Payday, Vehicle Title, and Certain High-Cost Installment Loans” (the Rule). As previously covered by InfoBytes , last October the...
InfoBytesCFPB files proposed consent order banning certain Canadian and Maltese payday lenders from U.S. consumer lending
On February 1, the CFPB and a group of payday lenders, including individuals and corporate officials based in Canada and Malta (collectively, “defendants”), filed a proposed consent order with the U.S. District Court for the Southern District of New York that would resolve allegations that the...
InfoBytesState Attorneys General weigh in on small-dollar lending RFI
On January 22, a coalition of 14 state Attorneys General submitted a comment letter responding to the FDIC’s Request for Information (RFI) on small-dollar lending. (See previous InfoBytes coverage on the RFI here .) According to the letter, while the coalition welcomes the FDIC’s interest in...
InfoBytesCalifornia small-dollar lender reaches settlement resolving interest rate allegations
On January 22, the California Department of Business Oversight (DBO) announced a $900,000 settlement with a California-based lender for allegedly steering borrowers into high-interest loans to avoid statutory interest rate caps. According to the DBO, the lender’s practice of overcharging interest...
InfoBytesDistrict Court certifies class action against lead generator’s payday lending practices
On January 11, the U.S. District Court for the District of Minnesota granted a motion for class certification in a case challenging a company’s payday lending practices under several Minnesota consumer protection statutes and common law. The plaintiffs filed the proposed class action alleging,...
InfoBytesColorado UCCC administrator issues guidance on alternative loan changes
On January 4, the administrator of the Colorado Uniform Consumer Credit Code issued a memo providing introductory guidance on alternative charge loans in response to Proposition 111, which amends the state’s Deferred Deposit Loan Act (DDLA) and takes effect February 1. (See previous InfoBytes...
InfoBytesFifteen states urge the 4th Circuit against allowing non-tribal payday lenders to receive tribal immunity
On December 27, 2018, fifteen state Attorneys General filed an amici brief with the U.S. Court of Appeals for the 4th Circuit opposing the use of structures in which non-tribal payday lenders affiliate with tribal lenders to benefit from their tribal immunity and avoid state usury caps. The brief...
InfoBytesIllinois authorizes higher verification fee under Payday Loan Reform Act
On January 4, the Illinois governor signed HB 4873 , which amends the state’s Payday Loan Reform Act (the Act) to increase from $1 to $3 the maximum verification fee that a certified consumer reporting service may charge a lender—and that the lender may pass on to the borrower—for verifying an...
InfoBytes
Our Alternative Finance Team
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Recent Blog Posts
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February 12, 2019
OCC praises CFPB’s payday rule proposal
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February 7, 2019
CFPB announces settlement with payday lending operation
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February 6, 2019
CFPB proposes to rescind ability-to-repay standards in payday rule
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February 6, 2019
CFPB files proposed consent order banning certain Canadian and Maltese payday lenders from U.S. consumer lending
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January 25, 2019
State Attorneys General weigh in on small-dollar lending RFI