DOCSLIB.ORG

AFS Best Practices Leadership Council Webinar PPP: the Big Picture a Retrospective Update

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
AFS Best Practices Leadership Council Webinar PPP: the Big Picture a Retrospective Update AFS Best Practices Leadership Council Webinar PPP: The Big Picture A Retrospective Update April 8, 2021 Vision to see the future...experience to get you there. afsvision.com Agenda Program History & Timeline • Legislative • Financial • Regulatory 2021 Key Features • Second-Draw Loans • Small/Minority Borrowers • Forgiveness PPP Overall Performance • Political/Legal • Regulatory • Operational • Media • The AFS Perspective • PPP Lenders Lender Experiences: Discussion April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 2 PPP Legislative Timeline Mar Jan Authorizing Act Apr May Jun Jul Aug Sep Oct Nov Dec Feb Mar 2020 2021 CARES Act Initial funding of Initial funding depleted by 4/16/20; application deadline 3/27/20 $349 billion 6/30/20; program expires 12/31/20 PPP and Health Care Authorized additional Enhancement Act funding of $310 billion 4/24/20 PPP Flexibility Act Various amendments – 60/40 cost ratio, 24 weeks 6/5/20 covered period by 12/31/20, forgiveness rules PPP Extension Act Application deadline extended to 8/8/20; 7/3/20 $137 billion remaining at deadline, returned to Treasury Re-launched with new Economic Aid Act product, $284 billion 12/26/20 funding, 3/31/21 expiry American Rescue Plan Act Authorized additional PPP 3/11/21 funding of $7.25 billion PPP Extension Act of 2021 Application deadline extended to 5/31/21, 3/30/21 SBA approval deadline to 6/30/21 April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 3 2021 Key Features New Funding, Second Loans & Set-Asides • $284 billion new funding • Second-Draw Loans – $2M maximum, first loan fully used, documented 25% sales reduction, 300 employees (vastly larger volume than first-draws) • Set-Asides for Small Lenders & Minority Borrowers – exclusive access windows • Set-Asides for Hard-Hit Industries – live venues, restaurants, hotels (including American Rescue Plan Act) • Forgiveness Process – one-page form for under $150K, self-select forgiveness period (8-24 weeks) • Processing Fees changes – smaller of 50% or $2500 for loans under $50,000 • New Allowable Expenses – protective measures, business software, supplies • Public companies prohibited April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 4 Loan Volumes by Funding Rounds New Funds Approved Net Approved Average Unused Funds Time Frame Lenders Authorized Loan Count Dollars Loan Size Returned Round 1 April 2–16 $349 Billion 1,661,367 $342.3 Billion $206,022 ---- 4,975 2020 Round 2 Apr 27–Aug 8 $310 Billion 3,671,659 $208.4 Billion $56,765 $137 Billion 5,460 2020 Round 3 $291.25 Jan 11–Mar 31 3,584,826 $211.8 Billion $59,084 ??? 5,236 Billion 2021 Grand Total $813.7 8,728,494 $734.1 Billion $84,104 TBD 5,476 (net of adjustments) Billion Approvals through 03/28/2021 Source: SBA April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 5 PPP Loan Funding Timeline Aggregate PPP Loan Data 9 900 Volume of Loans Number of Loans Round Round Round Approved ($ Billions) Approved (Millions) 8 800 1 2 3 7 700 6 600 5 **************** 500 4 Rounds 1-2 $137B remaining at Round 3 400 3 authorized August deadline, authorized 300 $659B returned to Treasury $291.25B 2 200 1 100 - 0 Loans Approved (#) Loans Approved ($000) April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 6 Loan Breakdown for 2021 PPP First Draw Loans Loans Approved Net Dollars Average Loan Size Lender Count Total First Draw Loans 1,562,181 $31.4B $20,126 5,123 First Draw – 10 or fewer employees 1,528,650 $23.0B $15,055 5,108 First Draw – LMI & less than $250K 442,085 $7.6B $17,230 4,455 Second Draw Loans Loans Approved Net Dollars Average Loan Size Lender Count Total Second Draw Loans 2,022,645 $180.4B $89,174 5,209 Second Draw – 10 or fewer employees 1,550,726 $48.7B $31,424 5,189 Second Draw – LMI & less than $250K 431,180 $20.8B $48,150 4,609 Total 2021 Loans Loans Approved Net Dollars Average Loan Size Lender Count Total First & Second Draw Loans 3,584,826 $211.8B $59,084 5.236 Approvals through 03/28/2021 Source: SBA April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 7 PPP Aggregate Loan Approvals (as of 03/28/21) Source: SBA April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 8 Top PPP Lenders by Total Number of Loans (as of 3/28/2021) Rank Rank Rank Total Net Dollars Average Lender Name Total Loans Approved Total 2020 2021 ($MM) Loan Size 1 1 4 Bank of America 473,864 $33,555 $70,811 2 2 3 JPMorgan Chase Bank 412,309 $39,461 $95,707 3 3 2 Cross River Bank 397,547 $11,265 $28,336 4 4 6 Wells Fargo Bank 264,933 $13,422 $50,661 5 *** 1 Itria Ventures (Biz2Credit) >250,000 >$6,303 $25,212 6 *** 5 Customers Bank >225,365 $7,710 $34,211 7 5 8 U.S. Bank 161,751 $10,317 $63,783 8 6 10 TD Bank 123,499 $11,509 $93,191 9 8 9 PNC Bank 113,082 $16,937 $149,776 10 7 11 Truist Bank 110,072 $15,416 $140,053 11 9 *** Citizens Bank 74,008 $5,259 $71,059 12 10 12 Zions Bank 71,689 $9,558 $133,325 13 11 14 KeyBank 66,010 $10,734 $162,611 14 *** 7 ReadyCap Lending >58,049 >$1,856 $31,972 15 14 15 M&T Bank 55,422 $9,360 $168,886 Source: SBA, AFS BI April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 9 PPP Aggregate Loan Forgiveness The forgiveness process is in place only for 2020 loans so far. 2020 Loans by Number 2020 Loans by Dollars Total Volume 5.2 million $521.2 billion Forgiven 2.3 million $194.5 billion Not Forgiven --- $0.6 billion Under Review 246K $87.8 billion Applications Not Yet Received 2.6 million $238.3 billion Data as of 03/25/2021 Source: SBA April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 10 PPP Overall Performance: Political & Legal • CARES Act was put together hastily and rushed through the legislative process in a matter of days in order to speed implementation and distribution. • SBA became “owner” of the program because it involved the 7(a) program, yet it overwhelmed the agency with expectations for immediacy, untested technology updates, and massive loan volumes. • Partisan disagreements in Congress created long gap in funding from April to August – biggest issues were aid to state/local governments and effects on budget deficit. • Legal but ethically questionable – loans to public companies; companies owned by members of Congress/spouses/families; administration officials/families; and loans to churches, anti-vaccine organizations. • SBA created 9-page “necessity questionnaire” for companies receiving loans over $2 million. • Political actions sometimes created more operational ones – two-week window in Feb/March “came too late” for many and caused application backlog for all others. • Are there potential legal issues to come? April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 11 PPP Overall Performance: Regulatory • Give SBA some credit – given a rushed and vague law, with expectation of immediate implementation, they were on the defensive with rules and technology glitches throughout. • Political requirements and pressures forced changes to be implemented virtually immediately – technology updates were rushed and inadequately tested. • SBA Inspector General issued report critical of SBA for setting stricter rules than CARES Act, causing “unintended burden to borrowers.” • GAO report stated SBA urgency to implement PPP caused undue confusion for duration of program. • Small businesses were uncertain whether they would qualify for forgiveness, causing many to return loans. More than 170,000 loans ($38B) returned by June 2020 over lack of clarity. • SBA Inspector General report in March 2021 found $692 in duplicate loans issued in 2020 to companies with same Tax ID; SBA “did not always have sufficient controls in place.” • Bankers praised technology improvements made by SBA to get ready for 2021 loans – new origination portal with improved user interface. April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved. Confidential & Proprietary. 12 PPP Regulatory Timeline CARES Act Enacted Mar 27, 2020 Mar Jan Apr May Jun Jul Aug Sep Oct Nov Dec Feb Mar TOTAL 2020 2021 New or -- 10 10 8 -- 2 -- 1 -- -- 3 -- 1 35 Amended Rules Procedural -- 2 1 1 1 -- -- -- -- -- 5 2 -- 12 Notices New or -- 2 1 5 2 -- 1 3 -- 2 1 -- 4 21 Amended Forms FAQs -- 39 9 2 -- 3 -- 1 -- 2 -- -- 1 57 Interagency 1 2 2 1 -- -- 2 1 1 -- 1 -- -- 11 Guidance April 8, 2021 Vision to see the future...experience to get you there. ©2021 Automated Financial Systems, Inc. All Rights Reserved.
Load more

Recommended publications
  • Does Fintech Substitute for Banks? Evidence from the Paycheck Protection Program
    NBER WORKING PAPER SERIES DOES FINTECH SUBSTITUTE FOR BANKS? EVIDENCE FROM THE PAYCHECK PROTECTION PROGRAM Isil Erel Jack Liebersohn Working Paper 27659 http://www.nber.org/papers/w27659 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 August 2020, Revised December 2020 We would like to thank Daniel Green, Greg Howard, Victor Lyonnet, Karen Mills, Bernadette Minton, Claudia Robles-Garcia (discussant), René Stulz, Tejaswi Velayudhan, and participants at the Stanford-Princeton Bendheim Center Corporate Finance and the Macroeconomy conference and seminars at Cambridge, Indiana, Northeastern, Penn State, Oklahoma, Ohio State, and Zurich for very helpful comments. Thanks to May Zhu, Jason Lee and David Xu for excellent research assistance. All errors are our own. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2020 by Isil Erel and Jack Liebersohn. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. Does FinTech Substitute for Banks? Evidence from the Paycheck Protection Program Isil Erel and Jack Liebersohn NBER Working Paper No. 27659 August 2020, Revised December 2020 JEL No. G00,G01,G2,G21,G23,G28,H12,H2,H3 ABSTRACT New technology promises to expand the supply of financial services to small businesses poorly served by the banking system.
    [Show full text]
  • Technology Solutions for PPP and Beyond
    Technology Solutions for PPP and Beyond Research Brief JUNE 2020 Small businesses’ struggles to obtain federal Paycheck Protection Program loans over the last two months underscore the substantial obstacles that they face in accessing capital and financial services more generally. Using data and technology to make small business lending faster, less resource intensive, and more accurate is critical to fostering a more rapid and inclusive economic recovery and to building a more resilient small business sector going forward. Small businesses are experiencing severe hardships during the COVID-19 crisis. To help support businesses with fewer than 500 employees, Congress established the Paycheck Protection Program (PPP) in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).1 The PPP is a temporary emergency Small Business Administration (SBA) 7(a) loan program with favorable terms, including a 100% government guarantee and potential forgiveness. However, PPP implementation has high- lighted and in some cases exacerbated longstanding challenges faced by small businesses in accessing credit: » Verification of identity. Many small businesses did not have extensive relationships with participating banks at the start of the Paycheck Protection Program. To onboard new customers, lenders must comply with identity verification and due diligence requirements, which demand a certain level of rigor, time, and resources. No central information repository exists for businesses, and traditionally used data sources may not include certain companies, such as newly formed businesses. » Insufficient information to evaluate loan applications. Small businesses’ financial information is not publicly available, less standardized than larger companies, and often not digitized. Lenders have historically devoted substantial resources to gathering and analyzing documents and data about small businesses.
    [Show full text]
  • THE ALTERNATIVE LENDING REPORT Volume 1, No
    SmallBusinessLending.io Finance • Technology • Legal & Regulatory • Strategy THE ALTERNATIVE LENDING REPORT Volume 1, No. 2 May 4, 2017 input/output CAN ALTERNATIVE DATA SOLVE ONLINE LEGAL & REGULATORY LENDERS’ ‘ALGORACISM’ PROBLEM? MCA Funder 3 Leaf Capital Called a Fraud by Partner ........................... 3 By Tim Lloyd STRATEGY A March 2017 letter written by Con- Beyond the prevalence of high costs, Online Commercial Lending: gressman Emanuel Cleaver, II (D-Mo.), double dipping, hidden fees, misaligned How it’s Changing the Landscape ............... 4 to Consumer Financial Protection Bureau sales incentives and stacking, the HBS Live Oak Cuts Risk, Woos Director Richard Cordray raises fresh con- paper opines that new algorithms could Women in Business .................................... 5 cerns about “algoracism” tainting the credit- “create unfair or discriminatory access to FINANCE risk-scoring models used by online lenders. credit.” This problem disproportionately Online Lending Associations Rep. Cleaver’s suspicions draw heav- affects black, Hispanic and women-owned Targeting Fintech and Education ................. 6 ily from a 2016 Harvard Business School businesses, in addition to entities that NEW TECHNOLOGY paper titled the “State of Small Business operate in low-income neighborhoods. & PRODUCT LAUNCHES Lending,” which addresses digital disrup- Biased algorithm design can occur if Platform announcements, new tion’s impact on regulation. Cleaver’s let- engineers code data correlation parameters software and services, and notable ter highlighted five predatory practices with attributes that make inadvertently product releases. ......................................... 7 cited by the HBS paper as pervasive in the discriminatory assumptions, which could INDUSTRY NEWS “Wild West” of online lending and alleges be violating the Equal Credit Opportunity A recap of recent news of that risk-scoring algorithms may be Act.
    [Show full text]
  • Securitizing Digital Debts
    Securitizing Digital Debts Christopher K. Odinet* ABSTRACT The promise of financial technology (“fintech”) and artificial intelligence (“AI”) in broadening access to financial products and services continues to capture the imagination of policymakers, Wall Street, and the public. This has been particularly true in the realm of fintech credit where platform companies increasingly provide online loans to consumers, students, and small businesses by harnessing AI underwriting and alternative data. In 2019 alone, fintech lenders represented nearly 50% of total non-credit card, unsecured consumer loan balances in the United States. One of the most prevalent ways fintech credit firms operate is by securitizing the online loans they help originate. In doing so, fintech lenders are able to access the capital markets and further the spread of borrowed capital and credit risk. Against this backdrop of increasing institutional investment in fintech securitized assets, this Article reveals how consumer finance law is playing a subtle but increasingly important role in commercial financial transactions. I do this by exploring how structured finance has come to operate in the fintech credit marketplace and by comparing it to pre-2008 securitization activity in the home mortgage context. In doing so, I critique algorithm-driven credit securitization and point out certain economic and legal risks that make it similar to pre-2008 mortgage securitization, as well as other risks that are unique to fintech finance. These pertain to, among other things, the opacity of loans underwritten through the use of alternative data and machine * Associate Professor of Law and Affiliate Faculty in Entrepreneurship, University of Oklahoma, Norman, OK.
    [Show full text]
  • Reasons for Being Unbanked
    THURSDAY JUNE 24, 2021 VOL. 186 No. 120 AMERICANBANKER.COM Follow us on Twitter @AmerBanker Nicolet Bankshares 5 acquiring rival Wisconsin bank for $219 million Reasons for being In buying the $1.5 billion-asset County Bancorp, Nicolet would become the second- unbanked largest bank in Wisconsin and the state’s No. 1 dairy lender. It’s the second bank Balance minimums lead the list of explanations unbanked acquisition deal Nicolet has announced this consumers give for not having a bank account. The proposed quarter. Page 5 FedAccounts would bar such limits. See story on page 2 P2P payments surged 6 during pandemic. So did the complaints about them. Lack funds to meet mininum balance requirements Gripes against peer-to-peer payments 29% services spiked during the past year as U.S. Don't trust banks consumers flocked to Venmo, Cash App, 16.1% Zelle and the like to transfer money. Page 6 Problems with personal ID, credit or former bank account 8% Fees are too high Sterling Bancorp’s AI assistant 7.3% 7 tackles half of customer calls Privacy fears The suburban New York bank says Skye, 7.1% its conversational artificial intelligence assistant, is doing the work of 100 full-time 0% 5% 10% 15%20% 25%30% employees. Page 6 Source: FDIC survey in 2019 of 32,904 households More than prepaid: Payoneer 8 broadens its sales pitch ahead of public listing The fintech, which is going public through a dailybriefing Cross River buys lending merger with a special-purpose acquisition 3 fintech, exec says company, has updated its logo and ‘more to come’ messaging to emphasize its capabilities FedAccounts billed as gift to The bank’s holding company, CRB Group, in e-commerce and digital marketing.
    [Show full text]
  • THE ALTERNATIVE LENDING REPORT Volume 1, No
    SmallBusinessLending.io Finance • Technology • Legal & Regulatory • Strategy THE ALTERNATIVE LENDING REPORT Volume 1, No. 5 June 15, 2017 input/output PROTECTING THE FACTOR FINANCE IN FACTORING AGREEMENTS Is Bizfi Up for Sale or Winding Down? ........ 2 STRATEGY (Part 1 of 2) DRB Calls Rival ‘Parasitic, Immoral’ By Josh Simpson, Esq. in Florida Factoring Lawsuit ........................ 3 Profile of a Small Business Like any financial transaction, factoring whom they intend to contract, before they Lending Applicant ....................................... 4 has quite a few inherent risks. For the fac- contract, to assure that if there is a breach tor those risks include the seller breach- that any damages can be collected.” NEW TECHNOLOGY & PRODUCT LAUNCHES ing the purchasing agreement, or contract, Due diligence in underwriting is the governing the transaction or purchase. The first line of defense against default because Platform announcements, new most common form of default, of course, it helps ensure that the companies you do software and services, and notable product releases. ......................................... 6 is default in payments owed to the factor. business with, and that the invoices you And that’s where it can get tricky. purchase, are sound. INDUSTRY NEWS To understand the legal complexities The Contract A recap of recent news of with collecting defaults, we need to start importance to lenders, brokers, from the beginning of the transaction. Let’s assume you’ve done due diligence and service providers. ................................. 7 Underwriting and want to proceed with buying the LOAN TAPE receivables. Now make sure you have the Firms with SME Loan Exposure .................. 9 What does underwriting have to do best contract possible.
    [Show full text]
  • February 4, 2021 Consumer Financial Protection
    February 4, 2021 Consumer Financial Protection Bureau Re: Advance Notice of Proposed Rulemaking Regarding Consumer Access to Financial Records Docket No.: CFPB-2020-0034 Dear Acting Director Uejio, Thank you for this opportunity to respond to the Consumer Financial Protection Bureau’s Advance Notice of Proposed Rulemaking on Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Background: Financial technology (fintech) offerings have grown rapidly since the passage of Dodd-Frank.1 ​ Many consumer experiences are now occurring digitally, with demonstrably beneficial outcomes for consumers. According to a recent Harris Poll survey, 73% of consumers say that these types 2 of fintech services will be their “new normal” for managing their finances after COVID-19. ​ This ​ growing financial technology ecosystem is built on the premise that consumers own and can knowingly authorize the sharing of their data to gain access to a desired product. We are financial technology companies that provide these types of services, powered by consumer-permissioned data, to millions of American individuals, households, and businesses. Consumers and businesses use our services to track their spending, save for the future, gain access to responsible credit, improve credit scores, pay down debt, and generally achieve their financial goals. Our customers come from a range of financial backgrounds, and bank with a range of financial institutions, from national banks, to digital banks, to local community banks and credit unions. To use our services, consumers rely on their ability to authorize the sharing of their financial data. When authorized access is consistent and reliable, a larger pool of ​ consumers are equipped with access to their financial data, which in turn incentivizes ecosystem participants like us to compete to develop innovative data-driven, consumer-centric services that help consumers and businesses manage their financial lives.
    [Show full text]
  • Project Dissertation Report on PEER to PEER LENDING - an EMERGING INDUSTRY ACROSS the GLOBE
    Project Dissertation Report On PEER TO PEER LENDING - AN EMERGING INDUSTRY ACROSS THE GLOBE Submitted By: Anshu Garg 2K16/MBA/06 Under the Guidance of: Dr. Sonal Thukral Assistant Professor DELHI SCHOOL OF MANAGEMENT Delhi Technological University Bawana Road Delhi 110042 DECLARATION I Anshu Garg, student of MBA 2016-18 of Delhi School of Management, Delhi Technological University, Bawana Road, Delhi-42 declare that Dissertation Project Report on Peer to peer lending – An emerging industry across the globe submitted in partial fulfillment of Degree of Masters of Business Administration is the original work conducted by me. The information and data given in the report is authentic to the best of my knowledge. This Report is not being submitted to any other University for award of any other Degree, Diploma and Fellowship. Anshu Garg Place: Date: i CERTIFICATE FROM THE INSTITUTE This is to certify that the Dissertation Project Report titled Peer to peer lending – An emerging industry across the globe, is a bonafide work carried out by Ms. Anshu Garg of MBA 2016-18 and submitted to Delhi School of Management, Delhi Technological University, Bawana Road, Delhi-42 in partial fulfillment of the requirement for the award of the Degree of Masters of Business Administration. Signature of Guide Signature of Head (DSM) Dr. Sonal Thukral Dr. Rajan Yadav Seal of Head Place: Date: ii ACKNOWLEDGEMENT I gratefully acknowledge my profound indebtedness towards my project mentor, Dr. Sonal Thukral, Assistant professor, Delhi School of Management, Delhi Technological University for her invaluable guidance, excellent supervision and constant encouragement during the entire duration of the project work.
    [Show full text]
  • Financial Technology
    Journal APEX 2016 AWARD WINNER FINANCIAL TECHNOLOGY Available to download at CAPCO.COM/INSTITUTE #44 11.2016 EMPOWERING THE [FINANCIAL] WORLD Pushing the pace of Financial Technology, together we’ll help our clients solve technology challenges for their business – whether it’s capital markets in Mumbai or community banking in Macon. We leverage knowledge and insights from our clients around the world: clients in towns everywhere are becoming 20,000 more efficient, modern and scalable. transactions processed help solve clients’ 27 billion challenges — big and small. moved across the globe in a single year $9 trillion empowers our clients’ communities to build storefronts, homes and careers. hearts and minds have joined forces to 55,000 bring you greater capabilities in even the smallest places. Empowering the Financial World FISGLOBAL.COM © 2016 FIS and/or its subsidiaries. All Rights Reserved. The Capco Institute Journal of Financial Transformation Recipient of the Apex Award for Publication Excellence Editor Shahin Shojai, Global Head, Capco Institute Advisory Board Christine Ciriani, Partner, Capco Chris Geldard, Partner, Capco Nick Jackson, Partner, Capco Editorial Board Franklin Allen, Nippon Life Professor of Finance, University of Pennsylvania Joe Anastasio, Partner, Capco Philippe d’Arvisenet, Adviser and former Group Chief Economist, BNP Paribas Rudi Bogni, former Chief Executive Officer, UBS Private Banking Bruno Bonati, Chairman of the Non-Executive Board, Zuger Kantonalbank Dan Breznitz, Munk Chair of Innovation Studies, University of Toronto Urs Birchler, Professor Emeritus of Banking, University of Zurich Géry Daeninck, former CEO, Robeco Stephen C. Daffron, CEO, Interactive Data Jean Dermine, Professor of Banking and Finance, INSEAD Douglas W.
    [Show full text]
  • The Regulation of Marketplace Lending
    Charlotte 201 South College Street, Suite 1600 Chicago New York 111 West Monroe Street 1270 Avenue of the Americas, 30th Floor Charlotte, NC 28244-0009 Chicago, IL 60603-4080 New York, NY 10020-1708 The Regulation of Marketplace Lending: 980.495.7400 312.845.3000 212.655.6000 Salt Lake City A Summary of the Principal Issues 215 South State Street, Suite 800 San Francisco Washington, DC 595 Market Street, 26th Floor 1717 Rhode Island Avenue NW, Suite 800 Salt Lake City, UT 84111-2339 San Francisco, CA 94105-2839 801.533.0066 Washington, DC 20036-3026 415.541.0500 202.478.6444 September 2020 Update chapman.com THE REGULATION OF MARKETPLACE LENDING: A Summary of the Principal Issues September 2020 Update Marc Franson Peter Manbeck* This document has been prepared by Chapman and Cutler LLP attorneys for information purposes only. It is general in nature and based on authorities that are subject to change. It is not intended as legal advice. Accordingly, readers should consult with, and seek the advice of, their own counsel with respect to any individual situation that involves the material contained in this document, the application of such material to their specific circumstances, or any questions relating to their own affairs that may be raised by such material. The publication and receipt of this document do not constitute legal advice or establish an attorney-client relationship with any person. Attorney advertising material. © 2020 Chapman and Cutler LLP * The authors acknowledge with thanks the contributions of other Chapman and Cutler attorneys to the preparation of this survey, including David Batty, Colman Burke, Besty Chang, Walt Draney, Sara Ghadiri, Tobias Moon, Rossina Petrova, Kathryn Puls, Matt Stone and Greg Xethalis, with special thanks to our Research Services team headed by Sarah Andeen, proofreader Leah Mayes and our Marketing Team headed by Nancy Linder with the able assistance of Rebekah Alm and Claire Wambach.
    [Show full text]
  • THE ALTERNATIVE LENDING REPORT Volume 1, No
    SmallBusinessLending.io Finance • Technology • Legal & Regulatory • Strategy THE ALTERNATIVE LENDING REPORT Volume 1, No. 1 April 20, 2017 input/output GLOVES COME OFF IN COLORADO COMMENTARY ‘TRUE LENDER’ CASES Addressing the Lack of Transparency in Small Company Lending ......................... 2 By Steve Evans STRATEGY “True lender” lawsuits filed in Colorado and Madden v. Midland Funding, LLC, With SBA Budgets on the Chopping highlight the ongoing legal ambiguity of from 2015 as legal authority for claims Block, What’s the Lending marketplace lenders using the bank partner alleging usury and other violations of the Environment Going Forward? ..................... 3 model. The latest dispute began earlier this state’s Uniform Consumer Credit Code. LEGAL & REGULATORY year when Colorado’s attorney general filed Referring to the Madden case, Colo- • Recent Litigation Illustrates complaints in state court against Marlette rado argues that “a bank cannot validly Why Merchant Cash Advances Funding and Avant of Colorado on behalf assign [federal interest rate exportation] Are Not Loans .......................................... 6 of the administrator of the state’s Uniform to a non-bank.” However, in that earlier • Bankrupt NuLook Now Facing RICO Suit ....................................... 8 Consumer Credit Code. Later amended Madden case, the dispute involved the and removed to federal court, the suits sale and assignment of charged-off debt NEW TECHNOLOGY allege violations based on earlier true lender – not loan originations under an ongoing & PRODUCT LAUNCHES and loan assignment cases. According to arrangement between a non-bank lender Platform announcements, new software and services, and notable the complaints, these non-bank companies like Marlette and Avant, and federally product releases. ....................................... 10 are the true lenders because they market insured institutions like Cross River and and service loans originated by New Jersey- WebBank.
    [Show full text]
  • Criminal Complaint
    AO 91 (Rev. 11/11) Criminal Complaint UNITED STATES DISTRICT COURT FILED for the Feb 03 2021 __________ District of __________ Northern District of California SUSANY. SOONG CLERK, U.S. DISTRICT COURT United States of America ) NORTHERN DISTRICT OF CALIFORNIA v. ) OAKLAND ) Case No. 4:21-mj-70194-MAG Christina Burden ) ) ) ) Defendant(s) CRIMINAL COMPLAINT I, the complainant in this case, state that the following is true to the best of my knowledge and belief. On or about the date(s) ofJune 20, 2020 in the county of Alameda in the Northern District ofCalifornia , the defendant(s) violated: Code Section Offense Description 18 U.S.C. 1344 Bank Fraud Maximum Penalties: 30 years imprisonment; $1,000,000 fine; 3 years supervised release; $100 special assessment; forfeiture This criminal complaint is based on these facts: See attached affidavit of TIGTA Agent Alofagia Onciano ’✔ Continued on the attached sheet. /s/ Alofagio Onciano Approved as to form /s/ Abraham Fine______ Complainant’s signature AUSA ABRAHAM FINE Alofagia Onciano, TIGTA Printed name and title Attested to by the applicant in accordance with the requirements of Fed. R. Crim. P. 4.1 by phone. Date: February 3, 2021 Judge’s signature City and state: San Jose, California Hon. Virginia DeMarchi Printed name and title AFFIDAVIT IN SUPPORT OF CRIMINAL COMPLAINT I, Alofagia Onciano, Special Agent, Treasury Inspector General for Tax Administration (“TIGTA”), being duly sworn, hereby state: INTRODUCTION AND AGENT BACKGROUND 1. I submit this affidavit in support of a criminal complaint charging CHRISTINA BURDEN (“BURDEN”) with the crime of bank fraud, in violation of 18 U.S.C.
    [Show full text]