All Sessions | Alternative Lending


1:30 - 2:15 Paula Tuffin


Effective Partnerships Between Banks and Marketplace Lenders - Managing Third Party Risk


Jim Shankle
Managing Director, CrossCheck Compliance LLC

Paula Tuffin
Chief Compliance Officer, Better Mortgage


Session Description

As marketplace lending continues to grow, banks have shifted their thinking from the potential disruption that may result from new business models to how to effectively partner with these emerging players. The FDIC encourages bank management to develop a strong understanding of its partner’s business model, establish contractual agreements that protect the bank from risk, regularly monitor the non-bank partner and require the partner to take corrective action to address gaps and deficiencies.  The CFPB regulatory requirements must also be taken into consideration.  Marketplace lenders who want to partner with banks need to ensure that they have taken all the right steps to demonstrate federal and state compliance to their bank partners, as well as to investors.

 Key learnings will be focused on both regulatory requirements and best practices:

  •  Managing compliance risk – requirements and best practices for a Compliance Management System (CMS)
  • Managing transactional risk - quality control best practices and managing potential risks arising from handling large loan volumes, document handling and movement of funds between institutions and third party originators
  • Managing servicing risk – assessing creditworthiness of the servicer and determining that back-up servicing agreements are in place
  • Establishing an independent audit program – what this really means and how to structure it to meet regulator and investor expectations


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