2016 Consumer Financial Services Conference

Hudson Cook LLP recently held its Consumer Financial Services Conference. I presented on two panels. The PowerPoint presentations for each follow:

BANK PARTNERSHIP AND THE VALID WHEN MADE DOCTRINE: UPDATE ON MADDEN V MIDLAND

Panelists:
Cathy Brennan, Partner, Hudson Cook, LLP, Hanover, MD
Meghan Musselman, Partner, Hudson Cook, LLP, Hanover, MD
Joseph Vitale, Partner, Schulte Roth & Zabel LLP, New York, NY

Description of Panel:
In the recent decision in Madden v. Midland Funding, LLC, the U.S. Court of Appeals for the Second Circuit held that National Bank Act preemption of state usury laws did not apply to accounts owned and serviced by Midland Funding, LLC, a non-bank debt buyer, even though a national bank originated the account. The panel will discuss how the decision undermines the “valid when made” theory and impedes the ability of national banks to sell loans they originate, thus reducing their ability to lend. The panel will also discuss the impact on anyone involved in a bank partnership model of lending and on those purchasing loans or lines of credit. Panelists will also discuss strategies for addressing the challenges presented by Madden, including licensing and deal structure responses.

Madden Panel

MERCHANT CASH ADVANCE AND SMALL BUSINESS LENDING SESSION: REGULATORY DEVELOPMENTS INCLUDING ISO AND BROKER ISSUES AND GOVERNMENT ADVOCACY

Panelists:
Cathy Brennan, Partner, Hudson Cook, LLP, Hanover, MD
Shawnielle Predeoux, Associate, Hudson Cook, LLP, Hanover, MD
Tom Sullivan, Executive Director, Coalition for Responsible Business Finance, Washington, DC

Description of Panel:
Panelists discuss recent activity by federal regulators and industry efforts to advocate for increased access to capital for merchants. Discussion also includes legal developments and best practices for working with independent sales organizations and brokers.

MCA Panel

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Death by a Thousand Cuts Update on Small-Dollar Lending

Death By A Thousand Cuts: Update on Small-Dollar Lending
By Catherine M. Brennan, Justin B. Hosie, K. Dailey Wilson, and Erica A.N. Kramer
Description
During the past year, small-dollar lenders continued to face increasing legal and regulatory scrutiny at the state and federal level.  One large lender blamed increasing regulatory pressure as the leading reason for ceasing to offer payday and title loans. This survey reviews some of the key investigation, enforcement, litigation, legislation, and rulemaking developments since August 2014