Maryland Legal Alert for Financial Services

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Maryland Legal Alert - September 2020

IN THIS ISSUE:

COLORADO SETTLEMENT IMPLICATES BANK-PARTNERSHIP MODELS

FINCEN ISSUES GUIDANCE FOR HEMP BANKING

IRS ISSUES UPDATED ‘SAFE HARBOR’ 402(F) MODEL NOTICES FOR RETIREMENT PLAN ADMINISTRATORS

OCC ISSUES GUIDANCE ON CUSTODIAL SERVICES FOR CRYPTOCURRENCY ASSETS

Colorado Settlement Implicates Bank-Partnership Models

The Administrator of the Colorado Uniform Consumer Credit Code and two large FinTech providers recently settled lawsuits filed in 2017 questioning bank-partnership models. The settlement not only provides a framework for structuring bank-partnership models in Colorado, but could be useful to FinTech providers and bank partners in addressing “true lender” concerns in other states.

Please click here for more information concerning these settlements and for tips on how to navigate “true lender” concerns going forward. Contact Christopher R. Rahl with any questions concerning this topic.

Contact Christopher R. Rahl | 410-576-4222

FinCEN Issues Guidance for Hemp Banking

Recently, the Financial Crimes Enforcement Network (FinCEN) issued guidance for financial institutions providing banking services to customers engaged in legal hemp production. This guidance supplements interagency guidance issued by multiple financial regulators late last year. FinCEN’s new guidance identifies ways for institutions to confirm a hemp grower’s compliance with state or federal licensing requirements and suggests additional methods of review for customers with higher risk profiles.

Please click here for more information on FinCEN’s guidance for hemp banking and contact Bryan M. Mull with any questions concerning this topic.

Contact Bryan M. Mull | 410-576-4227

IRS Issues Updated ‘Safe Harbor’ 402(f) Model Notices for Retirement Plan Administrators

The Internal Revenue Service and the U.S. Department of the Treasury have updated “safe harbor” guidance on eligible rollover distributions for retirement plan participants and administrators. These updates are available through explanations, known as “402(f) notices,” that present the rollover rules and the effects of rolling over or not rolling over funds into specified retirement plans. The new guidance addresses exempt distributions as well as tax consequences, among other changes, from the 2018 guidance resulting from the COVID-19 crisis.

Click here for more information on the 402(f) notices and contact Devin M. Karas with any questions concerning this topic.

Contact Devin M. Karas | 410-576-4080

OCC Issues Guidance on Custodial Services for Cryptocurrency Assets

The Office of the Comptroller of the Currency (OCC) has issued a guidance letter addressing the provision of custodial services for cryptocurrency assets. In the letter, the OCC confirmed that national banks and federal savings associations may perform safekeeping and custodial services with respect to their customers’ cryptocurrency assets in a similar manner as they would for a traditional asset.

Please click here for more information concerning the OCC’s guidance letter and contact Bryan M. Mull with any questions concerning this topic.

Contact Bryan M. Mull | 410-576-4227