CSBS sent the OCC a comment letter in response to its proposed guidelines for Evaluating Charter Applications From Financial Technology Companies, which reiterates that state regulators remain firmly opposed to the proposed national nonbank charter. The letter refers to previous comment letters stating that the charter would be an unprecedented, unlawful expansion of the OCC’s authority. The letter goes on to detail how the proposed charter would result in a fatally flawed regulatory framework. The charter will:
- cause distortion created by the ad hoc regulatory treatment of the proposed nonbank charters;
- create an unlevel playing field to the advantage of the proposed nonbank charter and to the disadvantage of traditional, full-service banks;
- erode the separation of banking and commerce; and
- cause consumer harm from the OCC preemption of vital state consumer protection laws.