Payments Pros – The Payments Law Podcast

In this special crossover episode of Payments Pros and The Consumer Finance Podcast, Carlin McCrory, Keith Barnett, and Chris Willis are joined by Jason Cover and Mark Furletti to discuss the Consumer Financial Protection Bureau's (CFPB) proposed interpretive rule on earned wage access (EWA) products. EWA allows employees to access wages they have earned before payday, with two main models: employer-integrated and direct-to-consumer. The conversation explores the differences between EWA and payday lending, emphasizing that EWA typically does not involve finance charges or obligations to repay.The podcast explains the CFPB's proposed interpretive rule, which replaces the 2020 guidance that was more favorable to the industry. The new rule would classify EWA products as credit under the Truth in Lending Act (TILA), requiring additional disclosures. The discussion also covers the CFPB's stance on expedited funding fees and tips, which they argue should be considered finance charges.The group discusses the CFPB's approach, noting potential challenges and the lack of justification for the proposed rule. They encourage market participants to submit comments before the August 30 deadline to address flaws in the CFPB's analysis.

In this special crossover episode of the Payments Pros Podcast and The Consumer Finance Podcast, Josh McBeain and Chris Willis are joined by colleagues Mark Furletti and Jason Cover to delve into the CFPB's Payday Loan Rule, which is set to become effective again following a Supreme Court decision. The discussion unpacks the broad scope of the rule, extending beyond traditional payday loans to include various financial products. The episode highlights the complexities of compliance, the nuances of the rule's definitions, and the critical steps lenders must take before the March 30, 2025, compliance deadline. Don't miss this insightful conversation on navigating the revived regulatory landscape.

Eli Polanco, founder and CEO of Nivelo, shares his expertise on the ramifications of the Money Transmitter Modernization Act on payroll processing. He discusses the complexities and increased operational costs stemming from varying state regulations. The conversation delves into the crucial partnerships between payroll providers and banks in ensuring timely payments and compliance with tax regulations. Additionally, Eli predicts a trend toward industry consolidation due to heightened regulatory pressures, raising concerns about stifled competition and innovation in the payroll sector.

Experts Mark Furletti and Jason Cover discuss the CFPB's new interpretive rule on buy now, pay later transactions, its impact on BNPL providers, regulatory challenges, and potential effects on administrative interpretations. They provide critical insights for industry stakeholders navigating this regulatory shift.

In this episode of Payments Pros, host Keith Barnett discusses the Federal Trade Commission's (FTC) lawsuit and $10 million settlement against the payment facilitator, BlueSnap. On May 1, the FTC filed a complaint alleging that BlueSnap and its executives aided and abetted a debt relief service provider's violations of the Telemarketing Sales Rule, along with violating Section 5 of the FTC Act.Keith highlights the FTC's allegations regarding BlueSnap's onboarding and due diligence processes, noting the issues that the FTC examines when investigating companies that facilitate payments, such as email correspondence, chargeback rates, fraud monitoring alerts, consumer complaints, and the circumstances under which the FTC believes a company should stop processing payments for merchants.

In this episode of Payments Pros, Carlin McCrory is joined by Nathan Ottinger, president of Georgia Banking Company's Payments and Technology Banking Group. They delve into the current state of the payments marketplace, characterized by heightened regulatory scrutiny and rapid innovation. Nathan underscores the importance of well-documented risk management strategies for financial institutions and the necessity for businesses to secure proficient legal counsel, particularly in the realm of money transmission.Nathan shares how Georgia Banking Company strategically focuses on specific industry segments and payment types, consciously avoiding the allure of the latest trends in bank-fintech partnerships. He emphasizes the significance of cultivating direct client relationships, conducting thorough due diligence during the client onboarding process, and maintaining ongoing portfolio management and oversight.Discussing payment technology innovations, Nathan highlights tools that enhance risk management and streamline processes. He concludes by reiterating the high ethical and regulatory standards required when handling other people's money, stressing the need for alignment between the client, the bank, and regulatory requirements.

Join Chris Willis and Josh McBeain as they dissect the CFPB's proposed overdraft rule, discussing its impact on large financial institutions, potential litigation challenges, the role of TILA, and the concept of Chevron deference. Get ready for an in-depth analysis of the regulatory landscape and what it means for consumers and the industry.

In the final episode of the Payments Pros special two-part series, Jordan Bennett, Nacha's senior director of network risk management, joins Keith and Carlin to discuss the new rules regarding fraud monitoring.Fraud Monitoring Phase 1 will become effective on March 20, 2026, and Phase 2 on June 19, 2026. These rules require all nonconsumer originators, ODFIs, third-party service providers, and third-party senders to establish and implement risk-based procedures to identify potential fraudulent transactions. The aim is to reduce the incidence of successful fraud attempts.The group discusses that the rules do not prescribe a specific method for monitoring, allowing each party to adapt according to their needs. However, inaction is not an option. Parties should conduct a risk assessment and adjust their policies accordingly.Jordan advises leveraging existing resources and ensuring contacts are prepared to respond to fraud incidents. He clarifies that these changes don't reallocate liability or establish new duties, but aim to foster teamwork in fraud prevention.

In this episode of Payments Pros, Carlin and Keith welcome back Jordan Bennett, Nacha's senior director of network risk management, for a two-part series on the newly approved rules designed to combat credit push fraud. Credit push fraud has been on the rise, and Nacha released a risk management framework to increase awareness and mitigate such frauds.The new rules, approved by Nacha's members on March 18, aim to mitigate fraud incidents such as business email compromise and efforts to exploit credit push payments. Part one of this series explores the risk management package, discussing the comprehensive set of rules and multiple rule amendments effective from October of the current year.Jordan highlights that the effective dates for some rules extend into 2026, providing ample time for preparation. The rules package was carefully crafted to reduce incidents of credit push frauds and provide financial institutions with useful tools.In addition to the rules, Nacha is also focusing on education and has released risk management guidance. The guidance is designed to help financial institutions improve their risk controls.The new rules include amendments for fraud monitoring by all parties in the ACH network, new rules around fund recovery tools, standardization of certain data fields, and changes to the Written Statement of Unauthorized Debit (WSUD) process. The rules are designed to increase awareness of fraud schemes, reduce successful fraud attempts, and improve recovery after frauds have occurred.Part two of this series will focus on fraud monitoring and what ACH Network participants can start doing now to comply with the recently passed rules. 

In this episode of Payments Pros, Carlin McCrory is joined by Nick St. John, director of regulatory compliance at America's Credit Unions, to discuss the Corporate Transparency Act (CTA) and related developments from the Financial Crimes Enforcement Network (FinCEN). Enacted in 2021, the CTA aims to combat the use of anonymous legal entities for money laundering. It mandates that legal entities report their beneficial ownership information to FinCEN, which maintains a database accessible to law enforcement, financial institutions, and other entities that meet specific criteria.Nick explains that the CTA applies to corporations and similar entities, with exceptions like banks and credit unions. Entities must report information about the company and its beneficial owners, defined as any person with a 25% or more ownership interest or who exercises substantial control. Reporting deadlines vary based on the company's creation date.He also clarifies the difference between beneficial ownership reporting to financial institutions and the new reporting to FinCEN. Under the CTA, there is no numerical limit to the number of control persons that must be reported. Financial institutions can request this information for customer due diligence compliance requirements. Carlin and Nick conclude by discussing future developments from FinCEN, including when the information will be made available to financial institutions and changes to existing rules to align with the CTA.