NEW YORK – New York Attorney General Letitia James has announced the voluntary dismissal of a lawsuit that had challenged a rule adopted during the last days of the Trump Administration and which was the suit alleged “opened the door to predatory lending.”
As CUToday.info reported, President Biden recently signed into law bipartisan congressional resolutions that rescinded the Office of the Comptroller of the Currency’s (OCC) so called “true lender” rule.
The New York Attorney General’s office led the lawsuit against the OCC to overturn the rule, and previously also called on congressional leaders to rescind the rule via legislation.
“The reversal of this predatory and abusive Trump era rule is a victory for all consumers,” said James. “The true lender rule made a mockery of federal law and would have prolonged the tide of exploitative and dangerous loans that trap vulnerable consumers in cycles of debt. Thanks to President Biden and a bipartisan coalition in Congress, we have effectively achieved the goal of our lawsuit — to invalidate this rule and ensure protections are in place for consumers going forward.”
James was part of a coalition of eight attorneys general that also included AGs from California, Colorado, Massachusetts, Minnesota, New Jersey, North Carolina, and the District of Columbia who filed the lawsuit in January of 2021 seeking to overturn the rule, which was also often referred to a “rent-a-bank” scheme in that it allowed non-bank lenders to “borrow” bank charters to make high-rate loans.