Congress, Supreme Court, Fdic discussed on Consumer Finance Monitor


I just be guessing. I I think I wouldn't expect to see a vital role in less than three months or so but It seems to me that this is a more discreet role making than others we've seen for example day Lung alone rulemaking. Where cycle to be controversial? Don't you think there will be a lot of consumer advocates and plaintiff's attorney's That may be involved in cases where this could have an impact I would assume They will not like what the OCC the FDIC you're proposing here. This will clearly be controversial. We have already seen blockposts from The plane of side or consumer advocacy groups that Really they're up in arms about the proposed any professor Adam. levittown add ED GW George Talent. I can't remember which one He's already written A pretty detailed blog post setting forth a His position Now he's I know didn't like the filing of the AMIGA spree and it doesn't like the proposed right here at all I guess just a concern I have the the agencies better get this thing wrapped up Before the end of the year probably early before the election But let you know assuming hypothetically We have a Democratic president next January changes will happen at the the OC in the FDIC and Just the gas. I'm not prepared to accept that your hypothetical but yes I I think there is you magic professor Lebanon. And he is a very bright guy and he Writes forcefully absolutely so It is incumbent upon the industry to have its advocates Put their best foot forward in support of this role in. Yes it if it doesn't happen this year before January There is at least posssibility that it will never happen. Yeah so assuming it gets finalized Jeremy This really happens. Do the problems in this area goal way or is there anything else left for us to worry about the so the browns do not go away away and There are many programs are out there where a bank in a nonbank Asian will will partner together to offer loans and other consumer financial products and these programs are subject to attack not only under the mad doctrine but also under a a a row called the true lender roll in here the Opposition says that while the longest formerly made by the back that in in substance. It's the non back that He has the greater financial interests the so-called predominant economic look interest in the loans. In that win the nine back does all the marketing does all the servicing and acquires the loan or the Overwhelming economic interests in the loan that each should be regarded as in substance. The true lender and since nine banks do not have the special usery authority provided by federal law than If the lender is required derived this the non-banking agent The parties to these programs are basically in a world of her. Isn't this an issue that you and I- litigated many years ago when payday lenders had partnered with Banks I think. At the time it was principally unsuitably national banks but there may be some state chartered banks involved and there had been a class class action litigation and I seem to recall. You won an important case the Hudson case. If my recollection serves me correctly was in federal court in Indiana. My there's no way you forgotten that case. It was a big case it was an important case and and yes. The decision was favorable to the industry in the court. Basically said this is not an area where piecemeal litigation should establish the rules that CAQ that the Supreme Court recognized in its leading case the Marquette decision that certainty was important to the banking industry. It further recognized that The protection of usury laws was a matter best left to Congress and the courts by establishing exceptions to The the principle that were outlined by Congress So that was basically what we argued in Hudson and the court adopted. That argument basically said that There were some superficial appeal to this idea of recapitalization but it was something best left to Congress in perhaps the banking agencies sees and and I felt that way ten years ago or when Hudson was decided in. I still feel that way I think there really really is a place for Congress.

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