CFPB Files Complaint Against Online Lender For Alleged Violations Of Military Loan Law | Goodwin
[author: Kelly Grosshuesch]
On December 4, 2020, the Consumer Financial Protection Bureau (CFPB) ad he deposited suit against an online lender who offers single payment and installment loans to consumers for alleged violations of the Military Loan Act (MLA). The MLA contains protections associated with consumer credit extensions for active-duty military personnel, including a maximum allowable annual percentage rate for military personnel (known as the Military Annual Percentage Rate (MAPR)) and certain disclosures. compulsory loan. This lawsuit is part of a larger CFPB law enforcement initiative targeting lenders for alleged MLA violations.
The lawsuit, filed with the U.S. District Court for the Northern District of California, alleges that the company has made more than 4,000 single payment or installment loans since October 2016. The CFPB also alleges that the company violated the MLA by granting loans with an MAPR that exceeds the limit of 36% of the MLA. Further, the complaint alleges that the company granted loans that required consumers to submit to arbitration and that the company failed to make the required loan disclosures in violation of mutual legal assistance.
The complaint seeks an injunction, pecuniary damages, restitution of ill-gotten gains and civil penalties.