Consumer Financial Protection Bureau Drops Lawsuit Over 950% APR Loans
WASHINGTON - Today, consumer groups deplored the Consumer Financial Protection Bureau’s (Consumer Bureau) abrupt and unexplained decision to drop a lawsuit against four online payday lenders who preyed on working families by making loans up to 950% that were illegal in at least 17 states. All of the lenders are owned and incorporated by the Habematolel Pomo of Upper Lake Indian Tribe located in Upper Lake, California. The lenders claimed that only tribal law, not state law, applied to the loans. However, in 2014, the Supreme Court made clear that tribes “’going beyond reservation boundaries’ are subject to any generally applicable state law.’” The loans to the borrowers were not made on the California reservation.