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Articles & Publications

Articles & Publications

Lifting of Longstanding OCC Consent Purchase May Signal Improved Environment for Bank Partnerships

CUSTOMER ALERT

On February 14, any office associated with Comptroller associated with Currency (OCC) terminated a longstanding cease-and-desist purchase against payday lender ACE money Express, Inc. underneath the regards to your order, which was in impact since 2002, ACE money was prohibited from “entering into any type of written or dental contract to provide any solutions, including payday financing, to your nationwide bank or its subsidiaries without having the previous approval regarding the OCC.” The raising your order had been done without fanfare, plus the OCC didn’t issue a press release or other general public statements describing the reason why for the action. Nevertheless, we believe it might portend an attitude that is favorable the federal degree toward “bank model” lending relationships.

The OCC put ACE money underneath the 2002 purchase as a result to alleged unsafe and unsound practices that amounted up to a “pattern of mismanagement” of this policies and procedures of Goleta nationwide Bank, the bank that is national which ACE maintained a financing relationship. The particular allegations included carelessness that is gross the management of loan files ( ag e.g., 641 files were allegedly disposed of by tossing them right into a dumpster) and systemic problems in recordkeeping that led to many violations associated with Equal Credit chance as well as the Truth In Lending Acts. In announcing your order on October 29, 2002, then-Comptroller regarding the Currency John D.