Not Square’d up

Dorsey bank license drive stirs storm

Square, the payment processor co-founded and run by Twitter Chief Executive Jack Dorsey, faced a renewed barrage of criticism from a community bank group on Wednesday.

The Independent Community Bankers Association is hoping to block Square from obtaining an obscure Utah banking license that would allow them to accept deposits and make loans.

If Square succeeds in getting a charter to become an Industrial Loan Company, it will compete with community banks without having to face normal bank regulations.

With the move, Square became the third FinTech company to seek a banking license.

“We think [there are] systemic dangers for mixing commerce and banking,” Chris Cole, senior executive vice president at the ICBA, told The Post. “Let’s be serious, Square is only the beginning. After Square, we’re pretty sure we’re going to see Amazon and Google get into the payment business.”

Square says that it already has loaned out about $1.8 billion through a partnership with Celtic Bank, another lender in Utah.

On Wednesday, the company confirmed that should it get the ILC charter, the CEO of the lending unit would be Lewis Goodwin, the former CEO of Green Dot, the largest US prepaid debit card company.

Green Dot, as well as other prepaid card companies, received heavy scrutiny in 2014, when Goodwin led the bank, for lax rules that allowed for scam artists to scam and launder hundreds of millions of dollars.

After a Senate panel called the CEO of the Green Dot parent company to testify, the company beefed up its rules.

In an e-mail, Square declined to directly answer questions about Goodwin’s past at Green Dot, but emphasized their compliance controls.

“Compliance is paramount in our industry, and prudent risk management, safe underwriting practices, and financial inclusion are cornerstones of Square’s approach to lending,” Dan Mahoney, a Square spokesman, told The Post.