28 June 2016 – Consumer Financial Services Watch

The Financial CHOICE Act; Legislative Text Revealed

Jun 28 2016

By Daniel F. C. Crowley, Bruce J. Heiman, William A. Kirk, Karishma Shah Page, Mark A. Roszak and Eric A. Love

On June 23, 2016, House Financial Services Committee Chairman Jeb Hensarling (R-TX) released as a “discussion draft” legislative text of the Financial CHOICE Act (“FCA”), a proposal to reform the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”).

Importantly, the FCA is more than just another Dodd-Frank reform proposal; it is the culmination of several years of House Financial Services Committee activity. Many of its provisions enjoy bipartisan support at a time when Brexit focuses attention on global financial regulatory reform. Therefore, we anticipate that the bill is likely to be marked up before the election, and it could be a road map for post-election reform. In addition, some of its provisions could be enacted in year-end omnibus legislation.

To read the full alert, click here.

U.S. Supreme Court Declines to Consider Whether National Bank Act Preemption Extends to Purchasers of Debt Originated by National Banks

Jun 28 2016

By Andrew C. Glass and Roger L. Smerage

On Monday, the United States Supreme Court decided not to review whether National Bank Act preemption, which provides national banks with a safe harbor from state usury laws, extends to third-parties that purchase and collect debt originated by national banks. The decision to deny certiorari in Midland Funding, LLC v. Madden, No. 15-610 (U.S. Nov. 10, 2015) (“Madden”), leaves intact a May 2015 decision of the Court of Appeals for the Second Circuit. The Second Circuit had ruled that National Bank Act preemption only applies to purchasers of national-bank-originated debt where the purchaser is a subsidiary or agent of, or is otherwise acting on behalf of, a national bank. (The K&L Gates alert regarding the Second Circuit decision can be found here.)

Archive:28 June 2016