New York’s financial services regulator is opposing a federal proposal to resolve legal disputes over when a bank or its fintech business partner are a loan’s “true lender” over concerns that it could erode state consumer protections.
The Office of the Comptroller of the Currency’s rule “would, in essence, allow unregulated nonbank lenders to launder loans through banks as an end-run around consumer-protective state usury limits,” New York’s Department of Financial Services said in a comment letter Wednesday.
The OCC proposed a rule July 20 to generally deem banks as the true lender of loans issued by partnerships between banks ...
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