Small Dollar Lending Regulation in 2019

In July 2018, the CFPB entered into a settlement with Triton Management Group, Inc. ("Triton"), a small dollar storefront lender operating in Alabama, Mississippi, and South Carolina.10 The CFPB found that Triton engaged in deceptive acts and practices by failing to properly disclose the l...

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Bibliographic Details
Published in:The Business Lawyer 2020-03, Vol.75 (2), p.2025-2032
Main Authors: Hosie, Justin B, Wilson, K. Dailey, Kramer, Erica A.N, Capurso, Christopher J
Format: Article
Language:English
Subjects:
Advertisements
Allegations
Attorneys
Attorneys general
Authorization
Commercial law
Companies
Compliance
Consent
Consumer protection
Consumers
County courts
Customers
Debt
Default
Enforcement
Federal court decisions
Fees & charges
Finance
Fines & penalties
Imposition
Interest rates
Litigation
Loans
Marketing
Money
Overpayments
Payday loans
Provisions
Restitution
Settlements & damages
Short term financing
State court decisions
Surveys
Underwriting
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Summary:In July 2018, the CFPB entered into a settlement with Triton Management Group, Inc. ("Triton"), a small dollar storefront lender operating in Alabama, Mississippi, and South Carolina.10 The CFPB found that Triton engaged in deceptive acts and practices by failing to properly disclose the loan term and payment schedule for certain Mississippi title loans.11 The CFPB also found that Triton violated the Truth in Lending Act by understating the finance charge in connection with its Mississippi auto title loans and failing to disclose the annual percentage rate for its loans in its advertisements.12 The consent order entered a judgment for equitable monetary relief of approximately $1.5 million against Triton; however, full payment of the amount was suspended, subject to Triton paying $500,000 to the allegedly affected consumers.13 A civil monetary penalty of one dollar was also imposed.14 In October 2018, the CFPB announced a settlement with Cash Express, LLC ("Cash Express"), a check casher, payday lender, and title lender based in Tennessee.15 The CFPB found that Cash Express engaged in deceptive acts and practices by sending collection letters to consumers whose debts were past the applicable statute of limitations.16 The CFPB also found that Cash Express engaged in deceptive acts or practices by misrepresenting to consumers that it may furnish information about them to consumer reporting agencies.17 Additionally, the CFPB found that when consumers used Cash Express's check-cashing services, the company's employees were required to keep some or all of the proceeds to satisfy consumers' outstanding debts with the company.18 Cash Express agreed to pay $32,000 in restitution to consumers and a $200,000 civil penalty to resolve the allegations.19 In January 2019, the CFPB entered into a consent order with Enova International, Inc. ("Enova"), a Chicago-based online payday and installment lender.20 The CFPB found that Enova engaged in unfair acts or practices by debiting consumers' bank accounts without the required authorization and by failing to honor loan extensions it had granted to customers.21 Enova agreed to pay a civil money penalty of $3.2 million to resolve the allegations.22 In February 2019, the CFPB entered into a consent order with Cash Tyme, a storefront payday lender.23 Among other things, the CFPB found that Cash Tyme engaged in unfair acts or practices by not having adequate processes in place to prevent unauthorized charges to consumers who had
ISSN:0007-6899
2164-1838