Financial Institutions and Markets (J)
In Indiana, a mortgage generally expires ten years after its maturity date – the date on which the last installment of the debt secured by the mortgage becomes due. However, when information respecting the maturity date is missing from the documents on file with the county recorder’s office, the time a mortgagee can bring a foreclosure action on the mortgage can be greatly reduced. On July 1, 2012, Indiana mortgage law was amended to cut in half the automatic expiration time for recorded mortgages that lack information respecting the maturity date.
On 12th October Gibraltar became the first jurisdiction to introduce laws to regulate firms carrying on business, from Gibraltar, using Distributed Ledger Technology (“DLT”). Limited regulation of certain DLT use cases exists in a handful of places but no other country has introduced the comprehensive regulatory framework we have set up in Gibraltar. The laws come into effect on 1st January 2018.
The Gibraltar Government and our regulator, the Gibraltar Financial Services Commission (“GFSC”), recognise that DLT is delivering innovative and transformational changes in the way the world conducts business. Those familiar with DLT will know that without the blockchain, a type of distributed ledger, Bitcoin and other crypto currencies could never exist. Gibraltar has moved quickly to embrace this technology and provide the framework for a well-regulated and safe environment for DLT business to flourish.
Authors: Rubens Vidigal Neto, Allan Crocci de Souza, Fernanda Mary Sonoki, Rafaella Flores Lellis
The Brazilian Central Bank (BACEN) has recently opened a public consultation for a new ruling that will regulate the fintech credit segment in Brazil (Public Consultation No. 55/2017). The proposal sets two new types of financial institutions, the direct credit company (Sociedade de Crédito Direto – SCD) and the peer-to-peer (P2P) lending company (Sociedade de Empréstimo entre Pessoas – SEP). Even though the proposed regulation aims at the fintech credit segment, it may also have an impact on the securitization and the alternative payment methods segments.
In recent years, the Brazilian fintech credit market has grown exponentially. This growth can be explained by the improved client experience and the better terms and conditions offered by fintech credit providers to their clients, and also by the fact that such fintech firms aim at consumers that are not usually targeted by conventional financial institutions. Due to strict regulatory framework and legal limits on interest rates that can be charged by lenders that are not financial institutions, most fintech firms work with bank partners that provide loans to the firms’ customers. This business model, on one hand, helps fintech firms reduce legal risk; on the other, however, increases costs and creates inefficiencies.
Bressler, Amery & Ross, P.C. Principal Denver Edwards was quoted in the Bloomberg BNA article, “Equifax Data Breach May Prompt Shareholder Derivative Suit,” by Jimmy H. Koo on September 13. The article discusses the recent breach of Equifax customers’ data and the possibility of a shareholder derivative suit.
A derivative suit against Equifax will likely allege breach of fiduciary duty. The purpose of any derivative suit is to “redress damages done by directors and officers,” but it isn’t “easy to have the board take action as they need to look at what happened” and assess whether there were any red flags, Edwards said.
Securities are governed by a multi-layered framework of federal and state laws. When a security is sold, it must either be registered or be exempt from registration under federal and applicable state law. A state exemption is required in each state in which the security is offered for sale or sold. An issuer that offers to sell or sells an unregistered security that is not exempt from registration commits an illegal act that could result in civil and even criminal penalties.
Section 3(a)(11) of the Securities Act and Rule 147 have historically defined what is commonly known as the federal intrastate exemption, which required, among other things, that the issuer offer to sell and sell only to residents of the state where the company was organized and doing a significant amount of business. Effective April 20, 2017, Rule 147 was amended and Rule 147A was adopted.