Regulatory Tracker — Page 10 of 10

The FTC reached an $18 million settlement with LendingClub over charges that the company misrepresented fees to consumers. LendingClub agreed to pay the amount to resolve claims of deceptive practices related to hidden fees.

FinCEN published AML/CFT national priorities for financial institutions, including fintechs partnering with banks, requiring institutions to tailor their AML compliance programs to identified threats. Regulators began examining compliance with these priorities.

The California Department of Financial Protection and Innovation (DFPI) reached a settlement with Chime Financial, Inc. for misleading use of the term "bank" without holding a banking license. Chime was required to stop using "chimebank.com," add bold disclosures near banking terminology, implement compliance procedures, and submit a progress report by June 15, 2021.

The FDIC fined a bank $1.8 million for UDAP violations related to collecting commercial debt. The specific bank name was not provided in the available source excerpt.

NYDFS published its report on the Apple Card investigation in March 2021, examining potential discrimination in credit underwriting by Goldman Sachs, the issuing bank behind the Apple Card.

The FTC settled with Beam Financial, a mobile banking app operator, banning it from offering financial services. The settlement required full refunds to customers due to misrepresentations about fund access and interest rates.

The FDIC published a final rule on parent companies of industrial banks and industrial loan companies (ILCs), establishing conditions and commitments for ILC parent companies. The rule was published in the Federal Register on February 23, 2021.

The NCUA imposed its first penalty against a credit union for AML compliance failures related to servicing marijuana-related businesses (MRBs). Live Life Credit Union was found to be relying on manual compliance processes to monitor approximately 150 MRB customers instead of implementing required automated systems.

FinCEN and federal banking agencies issued FAQs on January 19, 2021, clarifying Suspicious Activity Report (SAR) requirements and risk-based approaches for financial institutions, including those handling high-risk clients like MSBs via partnerships.

New York enacted S.B. 5470, a TILA-like disclosure law for commercial financing that explicitly applies to fintech platforms using bank partner arrangements. Civil penalties up to $10,000 per willful violation are enforceable by the NY Department of Financial Services.

The CFPB fined Santander $4.75 million in December 2020 for inaccurate auto loan data reporting under the Fair Credit Reporting Act. The action was not BaaS-related but involved consumer lending compliance.

The FDIC finalized a new brokered deposits rule on December 15, 2020, that excluded certain fintech-bank arrangements from brokered deposit restrictions. The rule was supportive of BaaS partnerships rather than punitive.

FinCEN issued guidance in December 2020 encouraging broader use of Section 314(b) voluntary information sharing among financial institutions for AML/CTF purposes. The guidance emphasized legal protections and benefits, potentially encompassing fintech entities in partnership with banks.

The OCC issued a consent order against Citibank, N.A. in October 2020 addressing deficiencies in risk management, internal controls, and data governance that led to violations of law. No suspension was imposed but corrective actions were required.

The CFPB issued a consent order against Washington Federal, N.A. in October 2020. The specific details of violations are not fully described in the source data but the action is documented in official CFPB records.

FinCEN issued a final rule extending BSA/AML, CIP, and beneficial ownership requirements to approximately 567 banks lacking federal functional regulators. The rule became effective November 16, 2020, with a compliance deadline of March 15, 2021.

The FCA published finalised guidance FG20/3 on branch and ATM closures or conversions, setting expectations for how firms should manage access to banking services.

The FDIC issued a request for information under its FDiTech initiative to reduce regulatory uncertainty for community banks partnering with fintechs. The RFI proposed a standards-setting organization and voluntary certification program for fintech partners.

The New York Department of Financial Services filed a Statement of Charges against First American Title Insurance Co. in its first enforcement action under the state's cybersecurity regulation (23 NYCRR 500). The action addressed cybersecurity deficiencies at the company.

The OCC proposed a rule in July 2020 clarifying the 'true lender' doctrine in bank-fintech lending partnerships. The rule aimed to provide uniform standards on whether the bank or its non-bank partner is the true lender of a loan.

The UK FCA issued finalised guidance in July 2020 for payment institutions and electronic money institutions on safeguarding customer funds during the COVID-19 pandemic. The guidance focused on prudential risk management to prevent insolvency harm.

NYDFS issued a consent order against Industrial Bank of Korea for BSA/AML and recordkeeping violations, imposing a $35 million penalty. The action was not fintech-specific but reflects heightened regulatory scrutiny of bank compliance programs.

The FDIC issued a proposed rule for consolidated supervision of ILC parent companies ('Covered Companies'), requiring written agreements on capital, liquidity, and risk management, with restrictions on affiliate service contracts.