Category: Regulation

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BRINGING ACCOUNTING STANDARDS INTO THE MODERN ERA: ANALYZING THE FINANCIAL ACCOUNTING STANDARDS BOARD’S PROPOSED DISCLOSURE REQUIREMENTS FOR DIGITAL ASSETS

A Note by Zack Stutler

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Technology’s growth over the past decade has permeated all aspects of life.[1] Financial markets have not been isolated from this increasing digitization.[2] More specifically, the introduction of digital assets (crypto-currency, non-fungible tokens, etc.) has taken the world by storm.[3] With the introduction of new assets comes the need for new regulations. While consumer regulations are important, so too are regulations on companies and how they report their ownership of digital assets.[4]

Regulations on companies are important because they increase the transparency of companies as well as look out for the interest of investors and the general public.[5] Without government intervention and regulations, corporations would logically operate in profit-maximizing ways that are self-serving.[6] This self-serving nature often lacks an eye for public interest and may promote a lack of disclosure which is not optimal … Read the rest

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IS STARBUCKS A BANK? HOW THE BILLIONS CONSUMERS UPLOAD ONTO STARBUCKS CARDS SHOULD BE REGULATED

A Note by Mackenzie Morgan

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As technology has continued to advance, so have company reward programs. In 2021, Starbucks customers loaded $11 billion onto mobile Starbucks Cards,[1] accounting for almost half of all Starbucks sales.[2] The amount of money consumers have loaded onto their mobile applications to prepay for their coffee orders has allowed Starbucks to overtake most banks in terms of assets.[3] “85% of US banks have less than $1 billion total in assets, illustrating the major player Starbucks has become in this space.”[4] Should the billions of dollars that consumers have uploaded onto Starbucks Cards be regulated by the federal government?

[1] Mary Meisenzahl, Starbucks Customers Have More Than $1 Billion Sitting on Gift Cards, Bus. Insider, (May 4, 2022, 1:50 PM), https://www.businessinsider.com/starbucks-says-over-1-billion-is-sitting-on-cards-2022-5.

[2] Lisa Moyle, Starbucks: Banking & Serving Coffee, Future Identity Fin., (July 19, 2022), https://fttembeddedfinance.com/starbucks-banking-serving-coffee/.… Read the rest

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ROBOTS DON’T TAKE BATHROOM BREAKS: ANALYZING THE APPLICABILITY OF CALIFORNIA’S A.B. 701 LEGISLATION IN ILLINOIS

A Note by Kevin Estes

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On September 22, 2021, California Governor Gavin Newsom signed into law A.B. 701[1] intending to further protect the health and safety of warehouse workers in the state of California.[2] Authored by California Assemblywoman Lorena Gonzalez, A.B. 701“strengthen[s] warehouse workers’ rights against arbitrary and abusive work quota systems by requiring companies to disclose work quotas to employees and state agencies, and establish statewide standards to minimize on-the-job injuries for employees working under strict quotas.”[3] Although the bill places restrictions on all single warehouse distribution center with 100 or more employees or 1,000 or more employees at one or more warehouse distribution centers in the state,[4] the bill specifically targets Amazon Inc. and their “extreme high-churn model, continually replacing workers in order to sustain dangerous and grueling work pace demands.”[5] To achieve its purpose, A.B. 701 … Read the rest

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Net Neutrality: Individual Privacy at Risk

By Jason Shultz

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Internet Service Providers (ISPs) have gained power to limit people’s access to the internet. In March 2017, Congress reversed regulations imposed on ISPs under the Obama Administration. These regulations protected internet consumers from having their access to the internet restricted by ISPs. This note examines the history of net neutrality and why removing regulations on ISPs is dangerous for internet consumers. People are now at risk of having their data sold and being limited in which websites are available through their ISP.… Read the rest

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Cosmetics Regulations: Loopholes in the FDA

By Claire Chung

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Cosmetic products in U.S. are very loosely regulated primarily because of the lack of enforcement mechanisms of the regulatory agency. This Note highlights the loopholes in FDA regulation and compares the regulatory scheme in U.S. and EC. There have been efforts both on the federal and state legislation such as introducing Personal Care Products Safety Act Proposal, enacting the California Safe Cosmetics Act of 2005 and Voluntary Cosmetic Registration Program. This Note proposes that the U.S. should pass the Personal Care Products Safety Act to enhance the current regulatory scheme in the U.S., which will make it more aligned with EC policies in cosmetics safety.… Read the rest

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Driving Solo: Solutions to the Current Patchwork of Legislation Concerning Automated Vehicles

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By Bryan Boccelli

This Note argues that states across the nation should expand upon and in some cases begin to introduce legislation in regards to self-driving vehicles. Although there are currently a handful of states that already have some form of regulation in effect regarding self-driving vehicles, the current patchwork of legislation is not very conducive for companies and entrepreneurs that wish to enter this market. This Note looks at a gradient system of automation as the basis for legislation that could potentially lead to greater investment from car manufactures in this area of technology. If adopted, a gradient system would mean that the automated vehicle would be subject to specific regulations based on a car’s level of automation. The more autonomous the car is, the more highly regulated it will become.… Read the rest

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Is Your Bank Account Safe? Financial Institutions’ Bad Faith Malpractice

By Claire Chung

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This Note argues that a poisonous culture in the banking industry, to indiscriminately profit by cutting legal and ethical corners, led to the Wells Fargo scandal in 2016. Wells Fargo had wrongfully profited by incentivizing its employees to meet sales quotas by creating phony accounts using confidential customer information without consent. Although the employees acted alone, liability lies on the employer, Wells Fargo, under the theory of respondeat superior. In doing so, Wells Fargo violated unfair and deceptive financial practices law. Also the scandal raised the issue of whether the mandatory arbitration clause in a financial product purchase agreement should be enforced against consumers or not. This Note proposes a multifaceted solution to address the pandemic of bad faith banking practices.… Read the rest

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Disclosure Dilemma: Is Disclosure to the Government Enough to Invoke the False Claims Act’s Public Disclosure Bar?

By Daniel Naydenov

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The federal government has a significant financial interest in the $3 trillion dollar health care industry. Due to limited administrative resources, the government’s biggest allies in the fight against health care fraud are individual whistleblowers who are able to file lawsuits under the False Claims Act’s qui tam provisions and share in the recovery. The Act contains a public disclosure bar to prevent parasitic suits by opportunistic whistleblowers. This Note analyzes two contrasting decisions from the Sixth and Seventh Circuits interpreting who qualifies as the “public.” In both cases, the court was asked to determine whether a health care provider’s self-disclosure of misconduct to the federal government was sufficiently public to bar future suits. Ultimately, this Note argues that the Seventh Circuit’s interpretation is more persuasive and closer to striking the proper balance between incentivizing whistleblowers and inhibiting opportunism.… Read the rest

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Quitting Quill: State Laws Challenge Quill’s Physical Presence Standard for Out-of-State Tax Collection

By Timothy Yuhasz

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Over the last fifty years, one of the bedrock principles of state and local tax jurisprudence has been the physical presence standard. The rise of E-commerce and a shifting economy, however, have for years called into question its validity. States, too, have taken notice, and new state laws are being crafted that either bypass this requirement or challenge it head-on. It may not be long before the physical presence standard becomes a thing of the past.… Read the rest

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Our Broken System: Modifying the U.S. Pharmaceutical Regulatory Scheme to Decrease Surging Prescription Drug Prices

By Dan Gutt

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The pharmaceutical industry’s societal purpose is to improve the health of the citizenry. However, the industry is beginning to fail that purpose by producing expensive prescription drugs, which are becoming inaccessible to the average person. Pharmaceutical prices began to spike in 2014, and there is no evidence that this trend will abate in the future. The causes of this phenomenon stem from several factors: expensive patented drugs, a reduction in the supply of generic drugs, and the pharmaceutical industries large marketing and sales expenditures. In summation, this is a complex problem that cannot be solved by a single solution, nor can it be solved by cost covering measures. Instead, innovative solutions that target the root causes of spiking pharmaceutical prices need to be applied. Examples of these solutions include governmental bulk-buying power, longer patent terms, referencing pricing for patented drugs, and improved FDA … Read the rest