WASHINGTON–State banking regulators have filed suit against the Office of the Comptroller of the Currency over its proposal to establish a special purpose national bank charter for financial technology companies, known as fintechs.
The lawsuit, which can be found here, was filed in federal district court in Washington, D.C., by the Conference of State Bank Supervisors, which represents state-chartered banks nationally, as well as state bank regulators. The suit argues that the OCC’s charter proposal violates the National Bank Act and other federal banking laws.
In the lawsuit the state banking regulators allege that the OCC is overstepping its authority under the National Bank Act, and further claim the OCC lacks authority to create a special purpose charter without approval from Congress.
"When the OCC has attempted to issue a charter to entities that would not carry on the 'business of banking,' the courts have struck down those efforts,” the plaintiff’s attorney states in the suit.
As CUToday.info reported here, in December 2016 the OCC proposed to charter fintech companies in the “business of banking,” but said it would not include institutions that receive deposits. In its lawsuit, the CSBS said the OCC should receive express statutory authorization to take such an action.
Several banking groups, including the Independent Community Bankers of America, have also previously objected to the proposal, as CUToday.info reported here.