WASHINGTON – Consumer advocates are applauding an announcement by the Office of the Attorney General (AG) of the District of Columbia that the District has forced EasyPay Finance to stop making loans with rates as high as 198.98%.
Interest rates are capped in D.C. at 24%.
As a result of the action the company will be paying a fine of $216,548.83, including more than $150,000 in restitution to consumers.
According to the District, EasyPay Finance offers loans through auto repair shops, pet stores, furniture stores and other retail locations.
“EasyPay laundered its loans through Utah-based Transportation Alliance Bank (TAB Bank) in an attempt to claim that the loans were bank loans exempt from DC’s interest rate cap,” the National Consumer Law Center said in a statement.
Earlier Settlements
The NCLC noted that in April, Colorado entered into a settlement with EasyPay that forced the loans out of that state, and in December 2022 Iowa did so in an agreement with TAB Bank.
“Iowa had an advantage, as it is the only state that has opted out of a federal law that allows out-of-state, state-chartered banks to ignore state interest rate laws across the country, though the Colorado governor just signed a bill opting Colorado out as well,” the consumer group said.
‘Predatory Puppy Loans’
Added Lauren Saunders, associate director of the NCLC, “TAB Bank has been fronting for EasyPay Finance to facilitate predatory puppy loans, auto repair loans, and furniture loans using deceptive and unlawful tactics leading to astronomical interest rates up to 189% in violation of interest rate laws. D.C.’s latest action against EasyPay and earlier lawsuits against OppFi and Elevate have sent a message and pushed predatory rent-a-bank lenders out of DC, showing how states can take a stand to protect their interest rate laws against evasions.”
The NCLC noted that in 2022 a series of reports highlighted EasyPay Finance’s predatory puppy loans, predatory auto repair loans, and predatory loans that harm veterans and servicemembers.
Consumer Alert
NCLC also issued a Consumer Alert on the EasyPay/TAB Bank auto repair financing practices and, together with other organizations, called on national auto repair chains like AAMCO, Meineke and Midas to stop offering predatory loans through EasyPay and TAB Bank.
The National Consumer Law Center said its High-Cost Rent-a-Bank Loan Watch List provides maps showing which predatory lenders are operating in which states using banks to evade state interest rate laws.
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