Thursday, January 24, 2019

Fintech Needs Regulatory Compliance Advice.

We have been representing financial service companies for decades, providing advice and guidance on a wide range of compliance and business issues.

A new practice area is opening as technology startups try to reinvent finance and are attempting to create new products and services in an old regulatory structure

Finance is one of the most heavily regulated parts of the economy, which leaves less room for creative interpretations of the rules. We dealt with this in the 80's as electronic trading came into being, in the 90's and 2000s as the Internet opened the markets to new investors and startups, as well as electronic delivery of offering and disclosure documents, and the distribution of same.

Those challenges continue and are critical for financial service companies to address these issues, and the regulators are paying attention.

According to Bloomberg, cryptocurrency exchange Coinbase ran into problems when it said it got approval from the U.S. securities regulator for three planned acquisitions. It hadn’t, according to the Securities and Exchange Commission. The company corrected its statement in July. The Federal Trade Commission said it reached a settlement with SoFi over allegations that the company made false claims about how much customers could save by refinancing student loans.Robinhood, which makes a popular stock-trading app, was forced to retreat from a plan to offer a quasi-bank account in December after questions about whether deposits would be insured. Wealthfront and a smaller roboadviser startup settled with the SEC over accusations of falsely advertising their investment products. None of the companies admitted or denied wrongdoing.

We look forward to continuing to work with new and innovative financial services companies and to bring to them our decades of experience in dealing with the cross roads of securities regulation and technology.
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Mark Astarita is a nationally known securities attorney with decades of experience in securities regulation and compliance. He can be reached at 212-509-6544.

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