Category Archives: Payday Lending

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FTC Imposes $110 Million Fine Against Payment Facilitator and Its Executives

Payment processor/facilitator Allied Wallet, its CEO, and two other corporate officers, recently agreed to settle Federal Trade Commission (FTC) charges that they assisted or knowingly processed fraudulent transactions for merchant-clients. This action indicates that enforcement actions against payment processors are alive and well, despite the FTC’s previously announced end of “Operation Chokepoint,” which, among other … Continue Reading

California Latest State to Consider Lead Generation Licensing

On Wednesday, June 26, 2019, the California Senate Banking Committee will take up AB 642, which would add certain lead generation activities to the definition of “broker” under the California Financing Law (Cal. Fin. Code § 22004 et seq.). If passed, companies that engage in lead generation (“lead generators”) would be required to obtain a … Continue Reading

CFPB Guts Major Component of Payday Lending Rule

Today, the CFPB proposed amendments to its Payday, Vehicle Title, and Certain High-Costs Installment Loans Rule. As anticipated, the bureau is proposing to rescind the rule’s requirements that lenders make certain ability-to-repay underwriting determinations before issuing payday, single-payment vehicle title, and longer-term balloon payment loans on the basis that such restrictions would limit consumer access … Continue Reading

CFPB Settles with Payday Lenders for Deceptive Practices

Last week, in CFPB v. NDG Financial Corp. et al., the Consumer Financial Protection Bureau (CFPB) entered into a proposed settlement with several payday lenders and corporate officials based in Canada and Malta. As background, the corporate defendants consisted of a network of affiliated companies, known as the NDG Enterprise, which extended high-cost, short-term payday … Continue Reading

Court Stays Compliance Date for BCFP’s Payday Rule

On Tuesday, the small-dollar lending industry received a favorable ruling in Community Financial Services Association of America v. CFPB. A Texas federal court reversed course by staying the August 19, 2019, compliance date for the Bureau of Consumer Financial Protection’s (BCFP) rule regarding “Payday, Vehicle Title, and Certain High-Costs Installment Loans.” The court also continued … Continue Reading

BCFP Enters Consent Order with Small Dollar Lender

Triton Management Group, Inc. (Triton) and several related companies entered into a consent order with the Bureau of Consumer Financial Protection (Bureau) in which Triton agreed to a $1 civil money penalty, $500,000 in consumer redress, and injunctive relief. Triton is a financial services company that originates, purchases, services, and collects on short-term secured and … Continue Reading

CFPB Issues Final Rules on Payday and Vehicle Title Loans—Little Impact for Auto Lenders

The Consumer Financial Protection Bureau (CFPB) issued its final rule on payday, vehicle title, and certain high-cost installment loans. The new rule is effective in 2019 and imposes stringent underwriting requirements and payment restrictions on certain covered loans. Be sure to review our previous blog post “CFPB Releases Long Awaited Small Dollar Rule: 5 Things You Need … Continue Reading

Alabama Supreme Court Says Cash Advance Company Not a Debt Collector

The Supreme Court of Alabama has reversed a jury verdict awarding the plaintiff $200,000 in damages, ruling on appeal that the Fair Debt Collection Practices Act (FDCPA) did not apply to the pawn transaction at issue. The case, Complete Cash Holdings, LLC v. Powell, arose from a forged title-pawn agreement. Ms. Powell’s granddaughter stole title … Continue Reading

If the CFPB’s Protection Power Weakens, Who Will Fill the Void?

As rumors circulate about the potential diminishing role of the Consumer Financial Protection Bureau (CFPB) within the new administration, one might wonder if the consumer financial lending space will become a lawless void. However, like a vigilante for justice, the state financial regulators are ready to step up and protect consumers in the financial space … Continue Reading

Consumer Lending Industry Targeted by the Alabama Legislature

Last month, a group of 45 members of Alabama’s House of Representatives introduced a proposed amendment to the Alabama Constitution that would cap the interest rate a lender may charge an individual on a “consumer loan, line of credit, or other financial product.” The proposed amendment, currently known as House Bill 321, is a direct … Continue Reading

CFPB’s Proposed Payday Rules Eerily Reminiscent of Mortgage Reform

This week, the Consumer Financial Protection Bureau (CFPB) proposed a long-awaited rule on payday, vehicle title, and certain high-cost installment loans – collectively. The proposed rule is open for comment through September 14, 2016. Generally speaking, the proposed rule covers two categories of loans. The first category is short-term loans that have a term of 45 days or … Continue Reading
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