Consumer Finance Insights
October 14, 2016

Indiana AG Reaches $1 Million Settlement with Online Payday Lender

On October 14, 2016, the Indiana Attorney General’s Office (Indiana AG) announced that it had reached a settlement with an online payday lender.  The Indiana AG alleged that the lender employed a “rent-a-tribe” scheme in which it allegedly associated itself with a Native American tribe in order to bypass the Indian Deceptive Consumer Sales Act and the Indiana Uniform Consumer Credit Code.  Over 10,000 Indiana residents secured loans affected by this purported scheme.  Under the terms of the settlement, the lender is required to repay approximately $1 million in restitution for loan costs and to cancel the loans it currently owns.  In addition, the lender must notify all credit reporting agencies to remove all associated loan information from consumers’ credit reports, and must notify all entities who purchased or were assigned the illegal loans.  The company was also banned from all lending activities in Indiana for two years.

Enforcement Watch previously covered the lawsuit between this online payday lender and the Consumer Financial Protection Bureau here, as well as other actions by state attorneys general against this lender herehere, and here.