Immediate Compliance Demanded: New York State Launches Inquiry of Online Lenders

dofs

Immediate Compliance Demanded: New York State Launches Inquiry of Online Lenders

New York state’s financial regulator sent a letter to 28 companies this week requesting information about their online lending activities, according to a person familiar with the matter and a copy of the letter seen by Reuters.

The New York Department of Financial Services sent the letter to San Francisco-based Prosper, the second-largest online lender, as well as to Avant, Funding Circle, Upstart and others, according to the person, who was not authorized to publicly discuss the matter.

The business is raising some novel questions for banking regulators, because online lenders have shunned a traditional banking model that uses deposits to make loans, and bypass their regulations. Instead, online lenders either connect borrowers directly with retail investors who want to fund loans, or they extend credit to borrowers, then quickly bundle the loans into securities that are sold to investors.

The department demanded “immediate compliance” with New York licensing requirements for debt collection, money transmission and mortgage lending activities, according to a copy of the letter reviewed by Reuters.

Rest here…

~

4closureFraud.org

Comments
One Response to “Immediate Compliance Demanded: New York State Launches Inquiry of Online Lenders”
  1. bgreen50 says:

    Are they speaking about Fremont?

Leave a Reply

Your email address will not be published. Required fields are marked *