State AGs sue HUD, OneMain; talking about stone money with M&T CEO Jones

On the docket
U.S. state attorneys general were busy yesterday.

First, a group of 16 state attorneys general sued the Department of Housing and Urban Development, our Ebrima Santos Sanneh reports, challenging the department's September guidance that narrowed the scope of the agency's fair-housing enforcement mandate. They argued that HUD is forcing them to abandon their own state laws, which provide more protection than federal laws.

It could be a significant case, determining the states' ability to enforce their own fair-housing laws. It could affect their ability to field complaints and assess mortgage lenders' compliance with fair-lending and anti-discrimination practices.

Then, another group of 13 state attorneys general (there was a lot of overlap among the states in the two cases) sued an installment-loan company called OneMain Financial, alleging that the company charged subprime borrowers "add-on" products and policies that "added" hundreds or thousands of dollars to their policies. The lawsuit alleges that the company made the add-on products hard to discern in the paperwork and even harder to opt out. Catherine Leffert wrote the story.

It's not the first time that OneMain – one of the largest installment lenders, operating in 44 states – has been in hot water with regulators. The CFPB fined it $10 million in 2023 over the same add-on practices.

The stone money of Yap
One of my favorite nerdy money stories involves a group of islands in Micronesia called Yap and their very unique monetary system. The Yapese developed a system of stone money called rai. They'd carve out all these circular stones with little holes in the middle of them. Some were small, some were so big they couldn't be moved. They just sat propped up along a road. Everybody knew who owned each particular stone, and possession of the stone was its own source of wealth. The entire economy was built around these stones.

There is even a story that one time some locals were transporting a large stone via boat. The stone fell over and sank to the bottom of the sea. Since everybody knew the location of the stone and who owned it, they just left it there and the owner was still credited with possession of it. Money, when you think about it, is less a tangible thing and more a system of accounting, and anything really can be used in that system. Gold, silver, paper, stones, software. Most of what we think of as "money" today really isn't anything more than some entries in a computerized database.

I bring this up because the story of the Yapese rai came up when I was talking with M&T Bank's CEO, Rene Jones, in our Leaders interview series. We talked about a lot of things in the interview – private credit, but also the competitive challenges facing the bank, its embrace of technology and what it means for the bank and its home base in Buffalo, and the changing nature of money. That's when the Yapese rai came up, and the idea that banking is less about "money" and more about what that system helps a bank's customers do. Anyhow the interview was simulcast live yesterday and the whole thing will be published later today. Keep an eye out for it.