- New research suggests “SEC rule intended to prevent conflicts of interest among staff has actually had the perverse effect of causing staff to profit from their knowledge as insiders of the SEC” [Thaya Brook Knight, Cato]
- “Federal Prohibition Left California Cannabis Farmers Without Insurance or Banks When Wildfires Struck” [Christian Britschgi]
- “Is Dodd-Frank/SOX reform dead?” [Stephen Bainbridge]
- Trial lawyers and CFPB did little to correct Wells Fargo fake-account scandal [Ted Frank WSJ letter]
- Study finds that more-cumbersome judicial foreclosure methods tend to correlate with tougher lending standards especially for poor; should constriction of home credit for poorer households be interpreted as a good? [Brian Feinstein, Chicago via CL&P]
- A different way to encourage more prudent home lending practice, scale back FDIC coverage [Scott Sumner]
Filed under: banks, Dodd-Frank, mortgages, Securities and Exchange Commission
4 Comments
Re: California pot growers.
Is there any reason why California could not have made adjustments to state insurance laws and banking regulation to accommodate this new business? Was it merely a bone headed oversight that they failed to embrace a new, and taxable, industry?
It’s not state insurance and banking laws that are the problem, it’s federal law.
Even if they had, there is no reason to suspect the the Federal Gov’t wouldn’t lean on the banks and insurers doing business with the growers, the same way they leaned on banks doing business with other “blacklisted” businesses. Bankers and Insurers are naturally risk averse – absent guarantees the State would protect them from the Fed, even the suggestion of potential Federal audit raises a healthy disinclination to do business with growers – the value of their accounts isn’t worth the hassle or the reputational damage.
“absent guarantees the State would protect them from the Fed”
As if any state government would be able to deliver on that guarantee if they were foolish enough to make it.