RK&O partner Jahan Sharifi was quoted in a Law360 article regarding a recent Treasury Department request for information about online marketplace lending. Many feel this is the latest indication that federal regulators are considering a new regulatory structure for the fast-growing industry.
The article noted that marketplace lenders are already subject to federal consumer protection and fair lending laws and that certain marketplace lenders are also subject to regulation by the SEC when they sell securities backed by their loans. However, many lenders are now selling whole loans to institutional investors, which does not carry the same disclosure burden, said Mr. Sharifi. "The SEC has taken the position that if you're selling whole loans that you're not selling securities."
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