Marketplace lending is a rapidly evolving segment of debt markets around the world, presenting opportunities to banks, institutional investors, venture capitalists, and technology platforms. The segment’s evolution is echoed in the varying terms describing marketplace lending, including P2P lending; online lending; marketplace lending; digital lending; algorithmic credit; direct lending. With fast-paced innovation and the ideal regulatory climate, perhaps the segment may simply be called “lending” in the future.
As technologies and regulatory guidelines shape the burgeoning segment, lawyers in our Marketplace Lending Practice can assist sector participants in achieving their business and investment objectives, while managing risks. Whatever market niches, strategies, and algorithms our clients wish to develop, we work side by side with them to innovate and navigate the legal, regulatory, and commercial challenges of this evolving consumer debt market segment. We assist sector participants with strategies, including:
We leverage our deep experience in consumer financial services regulation, e-commerce regulation, private equity, private fund formation, cybersecurity, finance and intellectual property to provide holistic support to market participants and provide the legal underpinning to innovation in the delivery of financial services in marketplace lending.
We have one of the preeminent consumer financial services regulatory practices in the United States and are active in Europe and Australia. We represent mortgage lenders, consumer finance companies, loan servicers, payday lenders, money-services businesses, online financial service aggregators, and technology companies in regulatory compliance and enforcement actions.
In the United States, we have extensive experience with the statutes and regulations enforced by the Consumer Financial Protection Bureau (CFPB), includ¬ing Regulation B, E, and Z and Gramm- Leach-Bliley. We have further experience with requirements imposed by the Financial Crimes Enforcement Network (FinCEN) and the Federal Trade Commission (FTC) related to the Bank Secrecy Act, suspicious activity reporting, consumer-privacy protec¬tion, and data-security policies.
Our practice includes traditional and e-commerce applications of current law governing consumer financial services. We have a dedicated group of professionals that for more than 20 years has helped compa¬nies obtain and maintain (i) state licenses nationwide, including navigating the on-line Nationwide Multistate Licensing System, and (ii) federal agency and GSE approvals, to engage in all manner of residential mort¬gage finance activities. In recent years, the state licensing work has expanded to cover the consumer, commercial mortgage, and non-real estate-secured commercial/busi¬ness finance activities of the marketplace lending sector of the economy. We are also very familiar with applicable state laws and federal preemption affecting usury, assignee defenses, and other issues.
We advise investment advisers and inves¬tors on all aspects of fund formation and maintenance, including fund documenta¬tion, structuring, and sponsor equity. We have a well-regarded team in the United States that represents institutional investors and high-net-worth individuals on a cross section of fund investments.
In the areas of global regulatory compli¬ance, we guide investment advisers and alternative investment fund managers on the U.S. Investment Advisers Act of 1940 and Investment Company Act of 1940; the Alternative Investment Fund Manager Directive and implementing legislation in EU member states including the UK and Germany; and the Australian Corporations Act 2001, which includes financial services licensing required for financial advisors.
K&L Gates was named the “Law Firm of the Year” for Securities Regulation in both the 2015 and 2016 U.S. News-Best Lawyers® survey.
K&L Gates has extensive experience in traditional registered offerings, private placements, and other exempt offerings around the globe, including under the U.S. Securities Act of 1933 and Securities Exchange Act of 1934, the MiFid Direc¬tive and the Prospectus and Transparency Directives (and implementing legislation in several EU member states), and Australian securities laws administered by ASIC. We also have significant experience in crowd¬funding and other innovative capital raising techniques provided by new laws such as the JOBS Act, Regulation A/A+, and other new exemptions from registration under securities laws.
With a global team in place, our capital markets and securities transactional capabilities span numerous jurisdictions. We regularly represent issuers, invest¬ment banks, placement agents, investors, and investment groups in a wide range of transactional, compliance, and regulatory securities matters. In addition to serving as company counsel, we provide experienced representation as underwriters’ counsel in public offerings and other transactions.
We understand how evolving laws relating to technology and information apply to e-commerce, and how our clients—whether they are licensors, licensees, or buyers or sellers—protect their opportuni-ties and respond to the transformative nature of conducting all or part of their business electronically.
We recognize that e-merging commerce regulations overlay traditional laws and industry practices. As this modern com¬merce involves, it’s important to engage lawyers who grasp all facets. One of our partners literally wrote the book on e-commerce, publishing The Law of Electronic Commercial Transactions, (Lexis¬Nexis 2003–2015). Authoring and updating relevant chapters in consultation with other K&L Gates lawyers requires collaboration across numerous disciplines. As a result, we are able to stay on the cutting edge and help clients leverage new defenses and legal trends.