NYDFS

The financial industry has praised the measured approach taken in a pending regulation on permitted communications with consumers. But two recent complaints by the bureau against debt collectors reflect a potentially aggressive enforcement stance.

The Conference of State Bank Supervisors, banking law scholars and consumer advocacy organizations filed amicus briefs siding with the New York State Department of Financial Services in its court battle with the federal regulator.

In another sign of state officials trying to outdo the Consumer Financial Protection Bureau, governors in California and New York want greater authority to license and oversee the debt collection industry.

With fintech firms appearing stuck in neutral in their efforts to seek bank charters from federal regulatory agencies, observers say state licensing options could be in vogue again in 2020.

In October, U.S. District Judge Victor Marrero ruled against the OCC in a case brought by the New York State Department of Financial Services.

A recent court decision allowing New York’s financial regulator to proceed in a case meant to block the Office of the Comptroller of the Currency from offering fintechs a new federal banking charter is having a chilling effect on potential applicants.

The Office of the Comptroller of the Currency had sought to dismiss the case, but a court ruling suggested that the state regulator’s claim may have merit.

The Department of Financial Services has created a statewide financial protection division focused on corporate compliance and consumer issues, in line with steps taken by New Jersey and Pennsylvania.

The agency refuted claims by the Conference of State Bank Supervisors that the OCC was overstepping its authority.

Federal and state regulators are at odds over the Office of the Comptroller of the Currency’s new licensing program, but there are ways to improve current law to appease both sides.