A Wednesday lawsuit filed by state banking regulators seeking to block the Office of the Comptroller of the Currency’s national charters to financial technology firms marks the latest pushback against its efforts to provide a uniform fintech regulatory standard, and could ultimately lead to the effort being abandoned.
The Conference of State Bank Supervisors alleges in its complaint that the OCC does not have the legal authority to create those charters, and challenges the OCC’s lack of a formal rulemaking process for crafting them. While there is some debate among observers about the CSBS’ legal arguments, the suit comes amid a flurry of opposition from state regulators, consumer advocates, Republican and Democratic lawmakers, and even some industry participants.