WASHINGTON—Is the CFPB pulling back on its previously strong position against payday lending?
Following the Bureau’s announcement that its payday lending rule would be re-written, it has now withdrawn a legal action filed last year against four payday loan companies.
The federal agency dismissed a case filed in April against Golden Valley Lending Inc., Silver Cloud Financial Inc., Mountain Summit Financial Inc. and Majestic Lake Financial Inc. That action claimed that the companies charged interest rates of between 440% and 950%, stating that a typical $800 loan required total payments of $3,320 over a 10-month period.
A lawyer for the companies told The Kansas City Star that the suit never should have been filed in the first place.
The CFPB said it “will continue to investigate the transactions that were at issue,” and could not comment on an open enforcement matter, The Starreported.
The four payday lenders are owned by the Habematolel Pomo of Upper Lake Indian Tribe.
As CUToday.info reported, Acting Director Mick Mulvaney has pledged to tone down the CFPB’s aggressive regulatory and enforcement stance.