Payments Shaping Up as Next Turf Battle Between OCC, States

A federal bank regulator’s recent moves to assert its authority to define the business of banking is likely to trigger more legal battles with state regulators.

Acting Comptroller of the Currency Brian Brooks’ plans to craft a special banking charter for payment companies could draw a challenge similar to the states’ so-far successful lawsuit against the OCC’s national charter for fintech lenders.

The federal agency’s ability to offer a federal alternative to state regulation of non-banks and designate them as national banks remains “a real live question,” Kristin Johnson, a Tulane University law professor who specializes in financial markets and ...