New Acting Banking Controller predicts rapid pace for FinTech program
From his first day as Acting Chief of the Office of the Comptroller of the Currency, Brian Brooks has set the tone for how he wants to leave a fintech-focused mark at the agency.
Brooks has laid out an aggressive agenda to redefine fintech politics, spanning everything from fintech bank charters to cryptocurrency. In an interview with Morning Consult on Monday, Brooks said he planned to come up with a new rule in a key part of fintech lending policy called a “real lender” in as little as two weeks, and claimed the role of l ‘OCC in banking charters. for fintech companies.
A rule on True Lender Doctrine would clarify when a bank is the actual lender of a loan, or when another party such as a FinTech company is. The rule could have huge ramifications for fintech companies, which have created complicated partnerships with banks that have, in some cases, allowed them to avoid state interest rate limits on online lenders.
Brooks plans to move quickly on that rule, with a proposal expected in two to four weeks, most likely on the shorter end of that time frame. Jelena McWilliams, President of Federal Deposit Insurance Corp. previously said Morning Consult that his agency is also working on the rule.
“We are in the midst of a great unbundling of the financial system,” Brooks said. “I have spent the last two years in Silicon Valley. I want to deliver all of this while I have the window to do so.
Prior to joining OCC, Brooks served as general counsel to Coinbase Inc. and served on the board of Avant, an online lender.
Brooks believes these types of banking and fintech partnerships can increase access to affordable credit for those who have had difficulty using traditional financial services. He has, however, faced backlash from Congressional Democrats who say he is undercutting consumer protection.
“More credit equals less poverty,” Brooks said. “Communities of color and underserved communities, banks are not serving them as well as they should be. ”
Brooks is also expected to push forward the issue of banking charters for financial technology companies – something his predecessor, Joseph Otting, attempted but was blocked by a district judge in a case that is currently on appeal. Brooks, a lawyer with years of experience in financial services, said he and the OCC “can’t wait to spend our day in court.”
This could be a problem that the OCC can accomplish largely independently. While banking regulators generally try to publish rules and guidelines together, Brooks said bank charters are another story.
“Each agency has a different role in the ecosystem, and I am the only regulator to create chartered banks,” said Brooks. “I don’t need anyone else’s permission. This is my job and my job alone.
Another big issue that will grab Brooks’ attention is cryptocurrency and stablecoins, building on his recent experience at Coinbase, he said. Stablecoins entered the conversation when Facebook Inc. ran into huge hurdles while trying to sell its Libra cryptocurrency project to banking regulators Last year.
Brooks, who declined to comment directly on Libra, plans to issue guidance on the matter, noting that banking regulators have not clearly defined the type of collateral that should lie behind stablecoins.
Brooks could continue to lead the OCC on an interim basis, be appointed by President Donald Trump to become the full comptroller or possibly be replaced – especially if former Vice President Joe Biden wins the presidential election and takes office. ‘next year. Whatever scenario plays out, Brooks is focused on pursuing a “great agenda.”
“If I can accomplish these things in nine months,” he said, “I would consider myself pretty successful. ”