The Consumer Financial Protection Bureau on Friday announced it had reached a settlement with a group of online lenders from Canada that will permanently bar the company from operating in the United States, but which posed no financial penalty.
The companies were accused of misrepresenting to individuals that not repaying their debts would result in lawsuits, arrest, imprisonment, or wage garnishment while also telling them that the loans were not subject to the laws of the United States.
Among the companies that were listed in the settlement were: NDG Financial Corp., E-Care Contact Centers, Ltd., Blizzard Interactive Corp., New World Consolidated Lending Corp., New World Lenders Corp., Payroll Loans First Lenders Corp., New World RRSP Lenders Corp., Northway Financial Corp., Ltd., and Northway Broker, Ltd. Also named were three individuals: Kimberly DeThomas, Jeremy Sabourin, and William Wrixon.
The CFPB originally launched the action against the companies back in 2015, under former Director Richard Cordray.
Along with not being able to make loans in the United States, the companies are banned from advertising, marketing, or promoting loans to consumers residing in the United States, assisting others in advertising, marketing or promoting loans, or receiving any remuneration for working with anyone making consumer loans in the U.S.
The defendants are also barred from collecting on any type of consumer loan in the U.S.
At the time, the defendants were making loans in all 50 states and for collecting money that individuals did not owe. In neither the original complaint nor the settlement was the actual dollar amount of loans made or collected on disclosed by the CFPB.
“We are taking action against the NDG Enterprise for collecting money it had no right to take from consumers,” said CFPB Director Richard Cordray, in a statement when the original complaint was filed. “Companies making loans within the U.S. have to comply with federal law, and the Consumer Bureau will work to ensure that American consumers receive the protections and fair treatment they deserve.”