On May 21, the Massachusetts Attorney General entered into an Assurance of Discontinuance (“AOD”) with a California-based fintech alleging that it was the “true lender” of its consumer installment loans. Under the terms of the settlement, the fintech is required to pay $625,000 in restitution, request deletion of tradelines on credit reports for loans reported to credit bureaus, and cease doing business in the state. Continue Reading Massachusetts AG Forces Fintech from State as Part of “True Lender” Settlement

On April 4, Kentucky enacted HB 88, which will amend laws related to unlawful trade practices, and prohibit entities that are not banks or trust companies from:Continue Reading Kentucky Restricts Marketing for Non-Bank Entities and Provides Clarity in Residential Real Estate Transactions

On March 25, Washington State became the latest in a growing list of jurisdictions to introduce a “true lender” law with the passing of bill SB 6025. The legislation, similar to laws in other states would characterize a person as the “lender” of a loan if the person makes a loan in excess of the state’s rate cap and if the person:Continue Reading Washington State Passes New “True Lender” Legislation

On March 25, a coalition of trade groups filed suit in the United States District Court for the District of Colorado, challenging a Colorado law which would have opted the state Section 521 of the Depository Institutions Deregulation and Monetary Control Act of 1980 (“DIDMCA”), a federal law enacted to create competitive equality between state-chartered banks and national banks. The law, set to take effect on July 1, 2024, would have subject out-of-state lenders to the state’s rate cap. Continue Reading Lenders Sue to Block Colorado’s Interest Rate ‘Opt-Out’ Law

On March 21, Wisconsin enacted into law Assembly Bill 574, positioning it as the third state, following Nevada and Missouri, to establish a comprehensive regulatory framework for earned wages access (EWA) services and products. The legislation is set to take effect September 1, 2024.Continue Reading Wisconsin Signs Earned Wage Access Bill into Law

On March 1, the Louisiana Senate introduced SB 335, a bill that would place certain disclosure requirements on providers of commercial financing transactions. Specifically, “providers” (defined as persons who consummate more than five commercial financing transactions per year with businesses in Louisiana) would be required to disclose the following in connection with each commercial financing transaction they engage in:Continue Reading Louisiana Becomes Latest State to Introduce Commercial Financing Disclosure Legislation

On March 5, the New York Attorney General filed a lawsuit against a network of over 30 lending companies and their officers alleging their involvement in a predatory “merchant cash advance” lending scheme that exploited New York businesses through fraudulent loans at “sky-high interest rates.” Continue Reading New York Attorney General Brings $1.4 Billion Lawsuit Against Merchant Cash Advance Lenders