OAKLAND, Calif. (Legal Newsline) – A federal agency has sued a lending company, arguing it violated the Military Lending Act.
The Consumer Financial Protection Bureau filed the case Dec. 4 in California federal court against LendUp Loans, which offers single-payment and installment loans to consumers.
But when it extends those loans, the company does so with an interest rate that exceeds the 36% cap stipulated in the Military Lending Act for servicemembers.
Those extensions require the consumers to agree to arbitrate any disputes, another violation of the MLA, the lawsuit says. This conduct has been happening since 2016, the CFPB adds.
“Since Oct. 3, 2016, LendUp has extended over 4,100 single-payment or installment loans to over 1,200 covered borrowers without making all loan disclosures required by the MLA,” the suit also alleges.