Free Video Downloader

Fast and free all in one video downloader

For Example: https://www.youtube.com/watch?v=OLCJYT5y8Bo

1

Copy shareable video URL

2

Paste it into the field

3

Click to download button


Senate Banking chair urges FDIC to look into Tellus, a fintech backed by Andreessen Horowitz
May 5, 2023

Senate Banking chair urges FDIC to look into Tellus, a fintech backed by Andreessen Horowitz

Reading Time: 3 minutes

Tellus, an Andreessen Horowitz-backed fintech company that claims it can offer people higher yields on their savings balances by using that money to fund certain U.S. single-family-home loans, is under scrutiny by the U.S. government.

On May 2, as first reported by Barron’s, U.S. Senator Sherrod Brown, chairman of the Senate Banking, Housing, and Urban Affairs Committee, wrote a letter to FDIC Chairman Martin Gruenberg expressing concerns about Tellus’s claims. In that letter, Brown pressed the FDIC to review Tellus’s business practices ‘to ensure that customers are protected from financial fraud and abuse.’ He said an article published early last month by Barron’s raised ‘several red flags.’

Brown also wrote to Tellus’s CEO and Chief Technology Officer Jeromee Johnson outlining his concerns and requested more information on their business practices.

Like the majority of fintech startups, Tellus is not actually a bank but instead partners with banks to offer banking services to consumers. While the company was founded in 2016, it only emerged from stealth last year after raising $16 million in seed funding last year led by Andreessen Horowitz. According to Barron’s (which cited records filed in Santa Clara County, California), an Andreessen Horowitz general partner, Connie Chan, earlier wed Tellus co-founder Rocky Lee. She filed a marriage dissolution/divorce lawsuit in 2021. It is not clear if the pair is still married. It is also unclear which partner from a16z led the round.

Tellus’s business model is unique, and risky. It targets existing home owners who wish to upgrade to larger homes without selling the homes they live in, which makes it difficult for them to receive approval for loans by traditional mortgage lenders.

In his letter, Brown wrote: ‘Although Tellus claims that it is not a bank, a fact its website repeatedly reminds customers of, I am concerned that Tellus’s practice of marketing high-interest deposits to fund real estate loans may give consumers the false impression that their money is as safe as a deposit at an FDIC-insured bank. I urge the FDIC to take a closer look at Tellus and its operations.’ He also pointed out that Tellus does most of its real estate lending in the San Francisco Bay Area, a region where property values have been declining.

He added: ‘This downswing may pose increased risks to Tellus depositors if Tellus borrowers default on their loans.’

Brown also pointed out that while Tellus touted partnerships with FDIC-insured banks such as JPMorgan Chase and Wells Fargo, it turns out those relationships ‘did not exist.’ Indeed, when Barron’s talked with both banks about the company’s claims toward that end, they expressed surprise, reported Barron’s. 

‘Wells Fargo does not have the relationship that’s described on Tellus’s website,’ the company said in a statement to Barron’s. ‘We are working with Tellus to update the language on their website, and remove our company’s name.’ Wells Fargo said it also disagrees with the description of itself as a ‘banking partner.’

JPMorgan told Barron’s it does ‘not have a banking or custodial relationship with the company.’

Barron’s published its investigative piece about Tellus on April 11. On the FAQ section of Tellus’s website, the company posted an update on April 26, saying: ‘Tellus is not a bank, and your Tellus accounts are not FDIC insured. All of our cash is held at leading banks, each member FDIC insured. We keep this cash at different banks to ensure you always have access to your money, even if there’s a problem with one of these banks. Once we lend money, that cash is considered ‘deployed.’ Deployed cash acts as a loan, meaning it’s a real estate loan itself and has no FDIC insurance. These loans are not mortgage-backed securities, as Tellus holds no mortgage-backed securities.’

In general, there has been widespread panic about accounts that are not FDIC-insured, leading people to withdraw billions of dollars from regional banks since mid-March to protect their assets and to the shutdowns of Silicon Valley Bank and First Republic Bank.

Want more fintech news in your inbox? Sign up here.

Reference: https://techcrunch.com/2023/05/04/senate-banking-chair-urges-fdic-to-look-into-tellus-a-fintech-backed-by-andreessen-horowitz/

Ref: techcrunch

MediaDownloader.net -> Free Online Video Downloader, Download Any Video From YouTube, VK, Vimeo, Twitter, Twitch, Tumblr, Tiktok, Telegram, TED, Streamable, Soundcloud, Snapchat, Share, Rumble, Reddit, PuhuTV, Pinterest, Periscope, Ok.ru, MxTakatak, Mixcloud, Mashable, LinkedIn, Likee, Kwai, Izlesene, Instagram, Imgur, IMDB, Ifunny, Gaana, Flickr, Febspot, Facebook, ESPN, Douyin, Dailymotion, Buzzfeed, BluTV, Blogger, Bitchute, Bilibili, Bandcamp, Akıllı, 9GAG

Leave a Reply

Your email address will not be published. Required fields are marked *