Australia's largest stock trading and investment forum Australia's #1 stock forum

APT

Click for more information

0.00%

$66.47 afterpay limited

Interesting read but I have to say that I dont have the...

First 84 Last

Share
Profile

Follow
311cpm963

391 Posts.

73

01/01/20

22:23

Post #: 42187733
Share

Originally posted by Goldbull22: ↑

Worth reading the below, potential implications for APT, you need to register to read the whole article so just copy and paste the below into google.

California denies license to point-of-sale lender
DBO Denies Lending License Sought by Unregulated Point-of-Sale Financer and Issues Related Legal Opinion
Dec 30, 2019

Download this press release (PDF)

SACRAMENTO – The California Department of Business Oversight (DBO) today denied an application by point-of-sale lender Sezzle, Inc., to make loans under the California Financing Law (CFL) after determining the Minnesota-based fintech company had engaged in illegal unlicensed lending in the state.

In a parallel action, the DBO issued a legal opinionadvising a second, unnamed lender that its point-of-sale products also meet the Civil Code and case law definition of “loans” and require a CFL license to be offered in California.

In its license application, Sezzle said its product provides “interest free on-line financing to consumers.” The lender targets young consumers who are unable to qualify for traditional financing options, like credit cards. Consumers pay Sezzle 25 percent of the purchase price at the time of purchase and the remainder in three equal installments due every two weeks.

Merchants pay Sezzle a cut of each transaction, and consumers pay Sezzle fees if they miss or wish to reschedule payments. Under the guise of purchasing from merchants already-consummated credit sale contracts – which may not be covered by the CFL – Sezzle designed its financing product to evade California and federal law.

Following a review of the company’s product and information Sezzle provided in connection with its application, the DBO determined Sezzle was making unregulated loans to California consumers in violation of the CFL.

The DBO concluded the purported credit sales made by Sezzle’s merchant partners were not bona fide but, rather, were structured to evade otherwise applicable consumer protections. In addition, the DBO found that Sezzle’s extensive role in its merchants’ transactions and pre-existing relationship with some consumers who were parties to the purported credit sales showed that Sezzle was making loans under California law.

Sezzle is one of a number of companies now offering unregulated, point-of-sale financing to Californians. In the related interpretive opinion, the DBO concludes that point-of-sale financing transactions may be deemed loans when:

The consumer, merchant, and third-party financer treat the transactions like loans, despite contradictory language in the applicable contracts;The relationship between merchant and third-party financer is extensive;The role of the third-party financer and all financing terms are not clearly disclosed to the consumer; andThe financing transaction is not otherwise regulated.The DBO licenses and regulates financial services, including state-chartered banks and credit unions, money transmitters, securities broker-dealers, investment advisers, non-bank installment lenders, payday lenders, mortgage lenders and servicers, escrow companies, franchisors and more.

Expand

Interesting read but I have to say that I dont have the education for all the legal wording but I do have one question..... Going by Stefans charts for Google trends in the US, why havent APT been pulled up by the Californian Financial Laws to date?

I did find the "Conclusion & Prayer" at the end of the legal letter interesting.... in particular "Application is denied due to Sezzle’s prior violations of Financial Code section 22100" Wonder what their prior violations were??

I guess we will just have to sit tight and see what happens in the future but I am confident that the BNPL industry is here to stay and is taking the the world by storm.

APT Price at posting: $29.28 Sentiment: Buy Disclosure: Held
3 Upvote

0 Great analysis

Reply

Top Stories

TX3

Canadian fieldwork yields multiple pegmatites for Trinex

AUG

Augustus sees imperial share rise on high-grade Cu and gold results at Ti-Tree

TLX

Telix jumps 11.6% as US government indicates proposed medicare changes won't affect prostate cancer drug

I88

Infini soars 50% as company reveals it could’ve just made uranium history – redefining what it means to be “high grade”

RNU

Renascor wins a funding boost given it wants to produce a critical mineral – but $5M award pales in comparison to some

There are more pages in this discussion • 115 more messages in this thread...

First 84 Last

Add APT (ASX) to my watchlist