The Conference of State Bank Supervisors says parts of the plan are an overreach, while the agency should think twice about developing the proposal during the coronavirus pandemic.
The Australian firm agreed to pay around $1 million in connection with allegations that it broke the law by operating without a license in the nation's largest state.
The state's Division of Banking, led by a former bank CEO and trade group chief, blocked GreenState CU's move to buy seven branches from First American Bank. This is the second time this year regulators have halted a credit union-bank deal.
In another sign of state officials trying to outdo the Consumer Financial Protection Bureau, governors in California and New York want greater authority to license and oversee the debt collection industry.
Former CFPB Director Richard Cordray and consumer advocates have designed a proposed state consumer agency that would subject more financial firms and fintechs to state oversight.
California Gov. Gavin Newsom plans to ask the legislature to revamp the current Department of Business Oversight and rename it the Department of Financial Protection and Innovation, modeled after the federal CFPB.
With fintech firms appearing stuck in neutral in their efforts to seek bank charters from federal regulatory agencies, observers say state licensing options could be in vogue again in 2020.
