April 24, 2019
ABA publishes True Lender article by Catherine Brennan and Latif Zaman
Hudson Cook attorneys Catherine Brennan and Latif Zaman recently wrote, "True Lender Developments: Litigation and State Regulatory Actions" for the Spring 2019 issue of the American Bar Association's quarterly publication, The Business Lawyer. The Business Lawyer circulates to approximately 40,000 readers nationwide and contains articles of interest to business attorneys, including case law analysis and developing trends.
Bank partnership lending programs have existed for years and have played a significant role in the growth of the online lending industry and the fintech sector. However, opponents of bank partnerships argue that the non-bank entity should be considered the "true lender" in transactions where the bank eventually sells the loan, or the majority of receivables from it, to the non-bank partner while retaining a participation interest. In this article, Catherine and Latif review key developments in true lender challenges over the past year.
Catherine is a partner in Hudson Cook's Maryland office. She primarily assists investors in the consumer financial services and alternative business funding sectors. She engages in credit due diligence on behalf of investors in fintech firms, bank partnership platforms, small business lenders, merchant cash advance companies, consumer finance companies, title loan companies and payday lenders. Latif is an associate in the firm's Maryland office. He assists consumer financial services clients on various federal and state regulatory compliance matters, and assists investor clients with due diligence of consumer and commercial credit programs. He advises licensed lenders on choice of law issues, and also advises clients on licensing requirements related to bank partnerships and litigation funding programs.
The authors would like to acknowledge the assistance of Katelynn Watkins with this article. Katelynn is a rising 3L at Michigan State University who assisted in the editing and drafting of this article while interning at Hudson Cook in the summer of 2018.