After allegedly operating a $133 million illegal payday loan racket, Think Finance has agreed to void all of its outstanding loans and pay $40 million to reimburse victims. A national payday lender, Think Finance, was accused of offering payday loans in states where the product is illegal. The settlement is pending approval by a U.S. Bankruptcy Court.
In Pennsylvania – where payday loans are illegal – Think Finance is alleged to have targeted some 80,000 customers. Through its partner websites – Plain Green Loans, Great Plains Lending, and Mobiloans – Think Finance sold payday loans and provided credit lines with APRs of 448%. To skirt the law, prosecutors allege that Think Finance tried to claim Native American tribe status and disguise itself as the First Bank of Delaware. By doing so, the lender would be exempt from reprisal as federal banks are given more leeway with their lending practices.
Pennsylvania Attorney General Josh Shapiro – who led the charge in Think Finance’s prosecution – told the media, “This is a model of how aggressive enforcement by one state can lend itself to nationwide relief for consumers. The settlement will provide relief to approximately 80,000 Pennsylvanians who fell victim to the $133 million payday loan scheme engineered by Think Finance, its affiliates, and consumers across the country who were also affected. Our Bureau of Consumer Protection will hold accountable anyone who tries to exploit Pennsylvania consumers by charging illegal interest rates.”
As part of the $40 million settlement, borrowers charged more than the legal interest rate of 6% would receive a proportional share of the proceeds. Those affected do not need to file a claim, as disbursement checks will be mailed directly. Victims can also request that credit bureaus delete information related to illegal loans.
As it relates to Pennsylvania law, Think Finance has violated Pennsylvania’s Unfair Trade Practices and Consumer Protection Law, the Corrupt Organizations Act, the Fair Credit Extension Uniformity Act, and the federal Consumer Financial Protection Act 2010.
Victory Park Capital Advisors was also named as a co-conspirator. The Chicago-based private equity firm is alleged to have participated in the scheme from 2011 to 2014. However, the group was only charged under the Corrupt Organizations Act.
If you were a victim or want to learn more about the settlement, visit www.PAThinkFinanceSettlement.com. You can also call 1-877-641-8838 to find out more information about your claim and whether or not you qualify for debt forgiveness. As well, checks will be mailed to addresses found on the original loan agreements. If you no longer live at that location, contact the settlement team, and provide an updated address.
As well, if you believe a lender is operating illegally in your state, you can file a complaint through the Consumer Financial Protection Bureau (CFPB). You can also contact the Federal Trade Commission (FTC), where you can report rip-off and impostor scams as well as unwanted telemarketing practices.