The OCC’s acting head is pushing against the Consumer Financial
Protection Bureau’s intention to charter non-depository fintech firms.
Brian Brooks, the acting head of the U.S. Office of the Comptroller
of the Currency and former chief legal officer to Coinbase, has warned
against the Consumer Financial Protection Bureau receiving the right to
grant “Fintech Charters.”
Earlier this week, the CFPB’s Taskforce
on Consumer Financial Law published a report featuring 102 policy
recommendations intended to “improve and strengthen” financial
regulations, including proposing that Congress empower the CFPB to
federally charter nondepository institutions — financial firms that do
not take customer deposits and collect fees for other financial
services.
Under Brian Brooks’ leadership, the OCC created the
Special Purpose Payments Charter for FinTech in 2020, paving the way for
certain crypto firms to apply for recognition as a national bank. Paxos
and BitPay sought approval for chartering under the new regime in December.
Should
the CFPB be extended the right to charter fintechs, it could reduce
regulatory clarity as to which agencies non-depository crypto firms
should apply to, and create overlaps between the mandates of the two
agencies.
In a Jan. 6 statement,
the acting OCC head pushed back against the CFPB’s request for the
right to charter fintechs, warning the move would undermine legislation
intended to separate the regulatory responsibilities of the two agencies
after the 2008 financial crisis:
"In its wisdom,
Congress in the Dodd-Frank Act separated chartering and prudential
supervision from consumer protection enforcement, assigning chartering
authority to the OCC and specific consumer protection enforcement
authority to the CFPB."
Brooks argued the existing
dynamic “should be preserved” to ensure that neither regulators
responsibilities overlap, noting “the additional protections implemented
following the last financial crisis [...] separated those
responsibilities so neither would be compromised in service to the
other.”
“That dynamic should be preserved so that the
CFPB continues to enforce compliance with enumerated financial consumer
protection laws for the financial companies designated by the Dodd-Frank
Act, while at the same time avoiding the creation of a prudential
supervision gap that could lead to serious safety and soundness risks.”
On Jan 4, the OCC published guidance informing national banks they can use public blockchains and dollar stablecoins for settlement, run nodes and act as validators for blockchain networks.
source link : https://cointelegraph.com/news/two-cops-on-the-beat-regulator-wants-sole-authority-to-charter-fintech-firms
