CFPB settles unauthorized payday loan allegations
On August 10, the CFPB announced a settlement with multiple defendants that allegedly made unauthorized payday loans. The settlement results from a 2014 complaint that alleged, among other things, that the defendants accessed consumer checking accounts to illegally deposit the proceeds of payday loans and withdraw related fees without consumer consent. The stipulated final judgment and order, among other things, (i) imposes a penalty of up to approximately $69 million if the defendants fail to fully comply with the operative terms of the settlement; (ii) prohibits the defendants from performing similar activities in the future; and (iii) assesses a civil money penalty of $1, in part based on the defendants’ inability to pay.
On July 23, as previously covered by InfoBytes, a court approved a stipulated final judgment and order against one of the defendants, who neither admitted nor denied the Bureau’s allegations, for a civil money penalty of $1 (based, in part, on his inability to pay) and agreement to fully cooperate with the Bureau.