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New York sues U.S. regulator for allowing fintech bank charters

September 14, 2018 By Jonathan Stempel NEW YORK (Reuters) – New York state’s top banking regulator on Friday sued the U.S. Office of the Comptroller of the Currency, seeking to void its decision to begin granting national bank charters to online lenders and payment companies. Maria Vullo, superintendent of the New York State Department of Financial Services, called the OCC’s July 31 decision to let financial technology companies, or fintech firms, apply for and obtain the charters “lawless, ill-conceived, and destabilizing of financial markets” best regulated by New York. She also said it puts the most vulnerable consumers “at great risk of exploitation” by weakening oversight of predatory lending, creating more “too big to fail” institutions, and undermining the ability of local banks to compete. The complaint filed in Manhattan federal court seeks a declaration that the OCC exceeded its authority under the National Bank Act and violated the U.S. Constitution’s 10th Amendment by usurping powers belonging to states. OCC spokesman Bryan Hubbard said in an email that the regulator, part of the U.S. Department of Treasury, will vigorously defend its authority to grant national charters to qualified companies “engaged in the business of banking.” Fintech firms had long pushed…

Source: One America News | New York sues U.S. regulator for allowing fintech bank charters

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