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by Matthew Russell Lee, Patreon Book Substack

SOUTH BRONX/SDNY, Feb 4 – Amid the FDIC's bid to eliminate public notice of and public comment on branch applications, the Federal Reserve and OCC are entertaining applications by Enova, the parent of high cost lender CashNetUSA, to acquire Grasshopper Bank, already deeply engaged in AI banking.

Fair Finance Watch filed:

  "opposition to the applications of Enova, parent of the high-cost payday lender CashNetUSA, to become a national by seeking to acquire Grasshopper Bank.    To allow a payday lender already fined by the CFPB to become a bank would be a new low.     "Enova used bank account information it had purchased from online lead generators, overwriting the bank account information that borrowers had authorized Enova to use... Enova cancelled loan extensions it had granted to certain consumers and in most instances debited such consumers’ bank accounts for the full loan payment instead of only a smaller loan extension fee" etc

  Now they want (to become) a national bank? Public hearings are necessary.  Combine this with Grasshopper's use of artificial intelligence in banking - a topic not yet scrutinize enough by the regulators, see for example Fifth Third and Brex, with Brex now being acquired by Capital One - and the need for public hearings on this CashNetUSA/Enova - Grasshopper (AI) proposal is all the more clear.

 The Federal Reserve Bank of Chicago confirmed receipt and and sent FFW its Additional Information letter - with each and every question withheld. So this FOIA has been filed:

"This is an immediate FOIA request for the AI letter the FRB of Chicago sent to Enova, owner of payday lender CashNetUSA, on its application to acquire Grasshopper Bank.  All of the AI question have been withheld - and should be release during the comment period.      For the record on this request, the Fed withheld all of its question to Fifth Third outside counsel - and then released them only after that comment period closed, and Fifth Third consummated the proposal even before the FRB (General Counsel) ruled on our timely request for reconsideration.  I was written to: in:sent Good morning Mr. Lee  I am contacting you about the above-referenced (and copy attached) FOIA Appeal you submitted to the Board on November 17, 2025, appealing “the FRB's withholding IN FULL of all Additional Information questions posed to outside counsel for Fifth Third, Rodgin Cohen, on Fifth Third’s application to acquire Comerica.”   As you know, the previously withheld information has since been cleared for release and published in the Board’s FOIA Reading Room for the application matter.    As such, please confirm that the Board may withdraw your appeal from further processing.  And wrote back Hi. Now that the fully withheld AI letter has been released - after the Board approved the application and the applicants consummated it, before before we got the General Counsel's response to request for reconsideration - yes, in this context, withdraw that appeal. Honestly, the entirety of this AI letter should not have been withheld during the comment period.  Here, the Enova AI must released during the comment period, or the comment period extended."

Meanwhile money laundering settler Bunq is applying to the OCC for a bank, along with a higher profile application by WLTC also protested by FFW.

 While Inner City Press simultaneously challenged Bunq and WLTC, by 7 pm on January 14 the OCC had only acknowledged FFW's comment on Bunq - nothing on WLTC - even now on January 26, while the comment period is running, set to expire on February 9 after a January 6 filing.

 This as the OCC says its reviews are apolitical.

Or perhaps it is just incompetence: on January 26, the OCC sent a FOIA response: "Good morning Mr. Lee, Your request 2026-00059-F is a duplicate of your previous request 2026-00045-F, which we have already received and are processing. As a result, we will administratively close the duplicate request and continue processing the original request."

But the requests are entirely different: they are about entirely different digital bank applications. And still the comment periods run...

See, e.g., Sept 10, 2025: https://www.americanbanker.com/opinion/the-fdic-is-undercutting-a-key-element-of-the-cra  

 But now the Federal regulator(s) blithely propose(s) to eliminate public notice and public comment on banks' proposals to expand.  The above-quoted reasoning is that few comments are filed. So, that is now changing.

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