February 22, 2023
This may be my favorite show we’ve ever recorded. It’s profoundly thought-provoking about the challenge that has been at the heart of my entire professional life: how to make financial services genuinely — almost completely — fair to everyone. My guests have been thinking more deeply about this challenge, and have been thinking about it across a broader spectrum of financial and technology possibility, than maybe anyone I know. Putting them together to brainstorm with us is, really, magic.
Delicia Hand was formerly a CFPB official and now is leading a transformative initiative at Consumer Reports. Cleve Mesidor is Executive Director of the Blockchain Association and also founded the National Policy Network of Women of Color in Blockchain. The idea to bring them together wasn’t mine — it came from Money 2020, which featured them in a shared session last fall on how to address bias in financial services. I was able to piggyback on that by sitting down with them there in Las Vegas (this is another of our shows that got delayed in the year-end backlog in 2022).
I’ve spent nearly all of my career working on consumer financial protection and inclusion. I’ve worked on solving these problems through laws, at the U.S. Senate Banking Committee. I’ve worked on solving them through regulation and enforcement, as Deputy Comptroller of the Currency (I was the first-ever deputy comptroller for consumer and community issues). I’ve worked on the same challenges at advisory firms, trying to strengthen industry compliance. I’ve worked on them as a volunteer on nonprofit boards, including chairing the boards of the Financial Health Network and FinRegLab, and serving on the board of the National Foundation for Credit Counseling. I also worked on the same issues at Harvard, doing research and writing on how innovation is changing finance and how to regulate it. Early in my career, I think I believed that good law and regulation would pretty much solve these problems. Decades later, I can see that was wrong. Regulation hasn’t solved these problems and, worse, I’ve realized that it can’t. We need good regulation, of course. But it’s crystal clear to me that while regulation is necessary, it’s not sufficient.
So I’m always looking for podcast guests who are working on new solutions, and today’s are doing exactly that. I know them both well. Cleve has been on the show before, and we have an episode with Delicia coming up soon, on the initiative she has launched at Consumer Reports to issue objective ratings on fintech products, like they do for other consumer products, from dishwashers to baby food.
As you listen, note that we recorded this after the crypto winter hit last year, but before the failure and scandal at FTX and its extensive fallout. With that in mind, though, listen to our guests’ thinking about the possibility that new, disruptive financial technology could be the road to big breakthroughs in financial fairness.
Listen, too, for their thinking about what the high-tech financial future may hold, and on how to navigate it. Compared to most of our conversations, they guide us farther out into the uncharted land that lies ahead — the wild places we’ll all soon be traveling, that almost none of us can clearly picture yet.
Please also listen closely as they explore a touchy issue that is rarely discussed: is there a point where consumer protection becomes paternalistic — where protecting people from risk has the unintended consequence of locking them out of opportunities to build wealth? Is it possible that we are, with the best of intentions, accidentally consigning people to savings and investment options that can never generate more than modest gains, reinforcing, rather than breaking, the traditional cycle in which the rich get richer and the poor don’t? If so, could there conceivably be a different way, a better way, in today’s high-tech world? Is there a chance to try some fresh thinking about safety and opportunity, protection and empowerment, while still preventing harm?
Listen also for another point that gets lost today in all the debate about the dangers of fintech, which is that traditional finance hasn’t always worked so well for people of color and people with limited means. We know that many people don’t feel welcome and comfortable at a bank. We know it’s hard to get good “wealth management” advice if you don’t already have wealth. No one thinks new financial products are a panacea, but we need to remember to compare them, not to perfection, but to old financial products, and ask how we can do better.
This is a powerful theme in parts of the crypto world, where there’s a vocal community of innovators coming from non-white traditions. Cleve, herself, helped lead the Black Blockchain Summit last year in Washington, DC. They were selling a t-shirt that said, “Satoshi is Black.”
What if digital technology really could make financial services work well for everyone?
Again, there is new thinking here.
Delicia Reynolds Hand is the Director of Financial Fairness at Consumer Reports. She leads the organization’s digital finance testing and ratings strategy, as well as organizational marketplace change strategy on consumer-friendly financial innovation. By creating a reliable and iterative testing framework for digitized finance, she hopes to influence the fintech market place by examining company behaviors and practices, which change outcomes for consumers. Rather than criticizing fintech, she wants to dive deep and test whether fintech lives up to its promise.
Delicia previously served as the Deputy Associate Director and Acting Associate Director for the Consumer Education and External Affairs Division at the U.S. Consumer Financial Protection Bureau. She has also served as Legislative Director at the National Association of Consumer Advocates, General Counsel at the Center for Community Change and Center for Community Change Campaign; and Senior Counsel/Legislative Director in the office of U.S. Rep. John Sarbanes of Maryland.
Cleve Mesidor leads the National Policy Network of Women of Color in Blockchain and is Executive Director of The Blockchain Foundation. Washington DC Mayor Muriel Bowser has appointed her to the DC Innovation and Technology Inclusion Council, and OneUnited Bank, America’s largest Black-owned bank, has recognized Cleve as a member of the “Black Crypto League.” A Washington insider, Cleve previously served as an Obama Presidential Appointee, a senior staffer in Congress, and in the leadership of national political campaigns. She hosts the annual Congressional Briefing of Women of Color in Blockchain in the nation’s Capitol. Her work has been featured in major media coverage. Cleve is a Howard University alumna and author of “THE CLEVOLUTION: My Quest for Justice in Politics & Crypto.”
We have great shows coming up – still catching up some of the backlogged ones from year end. We’ll have a great conversation with NCUA board member, Kyle Hauptman. Watch for our episode with Tara Rice from the Bank for International Settlements, and one with Tomicah Tilleman from Haun Ventures. Also, we’re coming up on both AIR’s fourth anniversary and Barefoot Innovation’s 200th episode, so we’re going to have some special shows to mark those special occasions!
I hope you saw AIR’s announcement that we have brought in our Chief Program Officer, Kisha Perkins, and made some other promotions and expansions of our team. We are nearly doubling our size over about six months and have people on three continents. Please visit our careers page to learn more and apply for our open roles!
We have many speaking engagements coming up, including at Fintech Nexus and at events with the Regtech Association, the American Bankers Association, the National Community Reinvestment Coalition, and Cleve’s own organization, the Blockchain Foundation, among many others. Again, see the show notes for details.
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