As we previously posted here, in March, Utah enacted its Commercial Financing Registration and Disclosure Act (CFRDA), requiring commercial financing providers to register with the Utah Department of Financial Institutions (DFI). The process requires registering with the Nationwide Multistate Licensing System and Registry (NMLS), providing certain information about the provider, and disclosing information about certain control persons relating to specified criminal convictions. Despite the January 1, 2023 deadline for CFRDA registration, the NMLS has already started accepting applications, and the DFI encourages providers to apply early to avoid backlog. To help streamline the process, the NMLS has created a requirement checklist found here.

As a reminder, the CFRDA requires a “provider” of commercial financing transactions to register annually with the DFI and pay a fee, unless an exemption applies.

  • A “commercial financing transaction” includes a commercial loan, a commercial open-end credit plan, and an accounts receivable purchase transaction.
  • A “provider” is a person who offers more than five commercial financing transactions in Utah in any calendar year. A provider also includes a person who, under an agreement with a depository institution, offers one or more commercial financing products provided by the depository institution via an online platform that the person administers.

However, several CFRDA exemptions exist for certain entities and types of transactions, including:

  • Depository institutions and certain regulated subsidiaries and service corporations;
  • Money transmitters licensed under Utah law;
  • Commercial mortgages;
  • Leases;
  • Purchase money obligations;
  • Commercial loans and open-end credit plans of $50,000 or more to motor vehicle dealers or rental companies;
  • Commercial financing transactions offered in connection with the sale of a product that the person manufactures, licenses, or distributes; and
  • Commercial financing transactions of more than $1,000,000.

Troutman Pepper routinely assists clients in complying with commercial disclosure laws and will continue to monitor the developments of state’s regulation of commercial finance.

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Photo of Caleb Rosenberg Caleb Rosenberg

Caleb is an associate in the firm’s Consumer Financial Services Practice Group. He focuses his practice on helping federal and state-chartered banks, fintech companies, finance companies, and licensed lenders navigate regulatory risks posed by state and federal laws aimed at protecting consumers and…

Caleb is an associate in the firm’s Consumer Financial Services Practice Group. He focuses his practice on helping federal and state-chartered banks, fintech companies, finance companies, and licensed lenders navigate regulatory risks posed by state and federal laws aimed at protecting consumers and small businesses in the credit and alternative finance products industry.

Photo of Chris Willis Chris Willis

Chris is the co-leader of the Consumer Financial Services Regulatory practice at the firm. He advises financial services institutions facing state and federal government investigations and examinations, counseling them on compliance issues including UDAP/UDAAP, credit reporting, debt collection, and fair lending, and defending…

Chris is the co-leader of the Consumer Financial Services Regulatory practice at the firm. He advises financial services institutions facing state and federal government investigations and examinations, counseling them on compliance issues including UDAP/UDAAP, credit reporting, debt collection, and fair lending, and defending them in individual and class action lawsuits brought by consumers and enforcement actions brought by government agencies.

Photo of Mark Furletti Mark Furletti

Mark helps clients navigate regulatory risks posed by state and federal laws aimed at protecting consumers and small business, particularly in connection with credit, deposit, and payments products. He is a trusted advisor, providing practical legal counsel and advice to providers of financial

Mark helps clients navigate regulatory risks posed by state and federal laws aimed at protecting consumers and small business, particularly in connection with credit, deposit, and payments products. He is a trusted advisor, providing practical legal counsel and advice to providers of financial services across numerous industries.

Photo of Chris Capurso Chris Capurso

Chris focuses his practice on consumer financial services compliance, guiding clients through the many federal and state laws and regulations that impact consumer credit programs.

Photo of Jeremy Rosenblum Jeremy Rosenblum

Jeremy focuses his practice on federal and state lending and consumer practices laws, with emphasis on the interplay between federal and state laws, joint ventures between banks and nonbank financial services providers, the development and documentation of new financial services products (especially products…

Jeremy focuses his practice on federal and state lending and consumer practices laws, with emphasis on the interplay between federal and state laws, joint ventures between banks and nonbank financial services providers, the development and documentation of new financial services products (especially products designed to serve the needs of unbanked and under-banked consumers), bank overdraft practices and disclosures, geographic expansion initiatives, and compliance with federal and state consumer protection laws, including statutes prohibiting unfair, deceptive and abusive acts and practices (UDAAP); usury laws; the Truth in Lending Act (TILA); the Electronic Funds Transfer Act; E-SIGN; the Equal Credit Opportunity Act; and the Fair Credit Reporting Act (FCRA).

Photo of Jason Cover Jason Cover

Jason’s in-depth experience advising on consumer lending matters both as in-house counsel and outside advisor provides extensive industry knowledge for his financial services clients.