Law360A current choice associated with U.S. District Court when it comes to Eastern District of Pennsylvania has highlighted yet again the regulatory dangers that the alleged вЂњtrue lenderвЂќ doctrine can make for internet-based loan providers whom partner with banks to determine exemptions from relevant state consumer security regulations (including usury regulations). Even though Court would not reach a concluding decision on the merits, it declined to just accept federal preemption as grounds to dismiss an enforcement action brought by the Commonwealth of Pennsylvania against an internet-based payday loan provider whom arranged for the state-chartered bank to invest in loans at interest levels surpassing the Pennsylvania usury limit.
The attention prices on these loans far surpassed those allowed under Pennsylvania usury legislation.
The situation is Commonwealth of Pennsylvania v. Think Finance, Inc. (January 14, 2016). 1 The defendants Think Finance and affiliated organizations (the вЂњDefendantsвЂќ) had for many years operated internet-based payday lenders that made loans to Pennsylvania residents. 2 The Defendants initially made these loans straight to Pennsylvania Continue reading “Brand brand brand New Federal Court choice pertains the вЂњTrue LenderвЂќ Doctrine to Internet-Based Payday Lender”