On April 8, the California Department of Financial Protection and Innovation (DFPI) filed a cross-complaint against a Chicago-based FinTech company alleging that as the “true lender” of consumer installment loans, it is subject to and also violated the Californian Financing Laws (CFL) by making loans in excess of the CFL 36% rate cap and that the FinTech violated the California Consumer Financial Protection Law (CCFPL) by offering and collecting on loans with rates exceeding the rate cap. The cross-complaint was filed in response to a complaint filed by the Fintech company in March to prevent the DFPI from applying California usury law to loans made through its partnership with a state-chartered bank located in Utah (we discussed this complaint in a previous blog post here).
Continue Reading California Strikes Back: Filing Cross-Complaint Alleging FinTech is “True Lender,” Seeks $100M Penalty
