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October 2020

Authors Explore Cases that Test Limits of the California Consumer Privacy Act

CaliforniaIn a recent article published by The Recorder, Jenner & Block Partner Kate T. Spelman and Associates Vivian L. Bickford and Effiong G. Dampha examine class action cases that test the limits of the California Consumer Privacy Act, which took effect January 1. “These suits shed light on the various ways plaintiffs are testing the boundaries of the CCPA and its private right of action,” the authors observe. They then highlight several categories of these boundary-testing lawsuits.

To read the full article, titled "Class Actions Seek to Test the Limits of the CCPA's Private Right of Action," please click here

Three Takeaways from Lendit 2020


By: Michael W. Ross 

FintechI recently attended LendIt’s 2020 conference, the largest Fintech conference of the year.  Kudos to everyone at LendIt for successfully transitioning the conference to a remote platform – it was a great few days of speakers and topics including really slick tools for engagement and networking. In this post, I’m sharing rough notes on my top three takeaways from the sessions I attended. This is by no means a comprehensive recap, and, if you attended, I’d love to hear from you about what you thought.

Artificial Intelligence. First, artificial intelligence and machine learning are on everyone’s mind these days. From regulators to service providers to financial institutions, speakers honed in on the use of AI for everything from underwriting, to risk analysis, to loan servicing, to many other things. Everyone is talking about the risks and rewards of using these new tools, including how to hone their models and how much to involve a human touch. As I listened, the relevance of our prior writing and talks on the potential for enforcement activity in the area of AI was top of mind – it has stayed quite relevant.  Check it out!

Serving the Underserved.  Relatedly, almost everyone seems to be talking about how technology is helping improve access to credit and banking services to those previously cut out – not only the use of AI, but also the overall digitization of banking, payments, and credit. Thought leaders are focused on looking beyond the ordinary credit file; on the use of mobile services to reach new consumers; and on the growth of non-traditional payment platforms. Stay tuned for developments in this area, including the broadening of the “payments” world to include non-financial institutions.

Partnerships.  Last, partnerships are all the rage. Financial institutions are buying startups, in addition to investing in technology themselves; smaller banks, community banks, and others are partnering to keep up with the latest tech trends; and regulators are focused on the third-party risk issues that partnerships raise, and also on allowing third parties to keep smaller banks competitive through partnerships. This area is not limited to true lender issues – especially keep an eye on the FDIC’s recent request for information on standard-setting for third-party service providers.

Again, these are just some blog thoughts from one attendee – please get in touch with your reactions and thoughts!

Colorado Consumers Receive Additional Protections after Attorney General Settles Lawsuits

By: Alexander N. Ghantous

loanIn August of 2020, the Colorado Attorney General’s Office settled two lawsuits concerning Colorado’s right to enforce its consumer loan interest rate limits.[1] The lawsuits involved Avant of Colorado, LLC (“Avant”) and Marlette Funding, LLC (“Marlette”), both of which are not banks.[2] However, partnerships with banks located outside of Colorado were established by the companies: Avant with WebBank, and Marlette with Cross River Bank.[3]

According to the Colorado Attorney General’s website, federal law permits “certain out-of-state banks” to offer loans at higher interest rates in Colorado than what is generally permitted in the state.[4] The Colorado Attorney General alleged that the partnerships in these matters were established to illegally offer loans at higher interest rates than what was allowed in Colorado.[5] While the lawsuits did result in a settlement, there was no admission of fault, liability, or wrongdoing.[6]  

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