On August 17, 2017, the Associated Press announced that Minnesota’s Attorney General is suing two lending firms (with the same Nevada address) for allegedly pressuring veterans and senior citizens into signing over large portions of their monthly pensions to cover small loans. According to the complaint, some interest rates were as high as 240 percent. The lawsuit alleges that the firms’ practices violated Minnesota usury statutes, and that because the two lending firms are not licensed to issue loans, the firms falsely labeled the transactions as “purchase agreements.” Issuing loans without a license is a violation of Minnesota law.
The Minnesota Department of Commerce is looking into the two companies’ practices in at least 100 Minnesota cases. One such allegation involves a disabled veteran, who was purportedly charged $27,000 for a $2,700 loan he was using to pay off medical bills.
The lawsuit seeks injunctive relief to cease the alleged practices, to nullify current unlawful loans, and restitution on behalf of those who have already paid the illegal interest.