CFPB Fines Online Lender $3.2M For Illegally Debiting Accounts

Enova International, an online payday lender, has been fined $3.2 million by the Consumer Financial Protection Bureau for allegedly withdrawing payments from individuals’ bank accounts without the proper permission and failing to honor loan extensions it had granted to customers.

The lender would purchase loan applications from lead generators and some of those applications were from individuals who already had loans with Enova. Those individuals would sometimes include different bank account information in the new applications and Enova would use the new account information to withdraw payments for the original loan, despite not having authorization to do so. The company allegedly did this more than 5,500 times, withdrawing “millions of dollars in unauthorized debits” according to the consent order between the CFPB and the lender. The unauthorized withdrawals were a violation “an unfair act and practice” in violation of the Consumer Financial Protection Act.

In more than 300 cases, Enova also attempted to withdraw a full loan payment, even though an extension had been granted, according to the consent order.

As part of the consent order, and in addition to the fine, Enova has also agreed to:

  • No longer debit accounts without obtaining the proper consent
  • No longer make or initiate electronic funds transfers without obtaining proper authorization and providing the customer with a signed copy

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