OCC says it will appeal decision blocking ‘fintech charter’; court held regulator did not have authority

The federal regulator of national banks and thrifts reportedly said Tuesday it will appeal a Monday federal court decision blocking charters from the regulator for non-depository, special-purpose national banks – the so-called “fintech charters.”

According to reports, the Office of the Comptroller of the Currency (OCC) will appeal the decision by U.S. District Court Judge Victor Marrero of New York. Marrero held Monday that the National Bank Act does not give the OCC authority to grant national bank charters to non-depository institutions without a statutory exception. Marrero issued the decision at the request of the New York Department of Financial Institutions. The ruling essentially vacates an OCC regulation permitting the charters. However, the judge did not dismiss the case, brought by the New York regulator against the OCC.

In July 2018, the agency said it would consider charter applications from companies seeking to become special-purpose national banks that would engage in one or more of the core banking activities of paying checks or lending money, but that would not take deposits or be insured by the Federal Deposit Insurance Corp. (FDIC).

In June of this year, an OCC representative testified before Congress that no charter applications had yet been received.

Be the first to comment

Leave a Reply

Your email address will not be published.