Seems that the Treasury got the boos it was waiting for. The latest developments at LendingClub were the catalyst for an "I told you so" approach by Treasury, moving the regulator to send out an additional call for information from online lenders. The intention is to have stricter monitoring capabilities through more transparent relationships and transactions. The fear by many, is that instead of helping online lenders pass through the regulatory hurdles (while of course maintaining compliant), now these lenders will have to deal with enhanced scrutiny.
The Securities and Exchange Commission has the authority and is already on it, he said. “What is too bad,” said Knight, “is that instead of talking about how to streamline the existing patchwork regulation that, for example, forces these firms to go state-by-state for licensing, Treasury is talking about adding more regulations to the morass.”