CashCall asks judge to overturn $134 million judgment

CashCall is fighting a $134 million judgment in a long-running battle with the Consumer Financial Protection Bureau (CFPB). The lender is asking a federal judge to throw out the massive fine, claiming the government acted in bad faith. CashCall argues that they had a deal in place to pay a much smaller settlement, but the CFPB backed out at the last minute. This case is a critical reminder for any business using high-interest lending models. The CFPB has spent years targeting lenders who use 'rent-a-tribe' schemes or other methods to bypass state interest rate caps. For retailers, this means the regulatory environment remains aggressive toward high-cost financing products. If your business partners with subprime lenders or high-APR providers, you must ensure their business model is legally sound. A lender facing a nine-figure judgment can face liquidity issues or sudden shutdowns. This case signals that the CFPB is not afraid to walk away from small settlements to pursue massive penalties against companies they believe are exploiting consumers. Keep a close eye on your lending partners' regulatory history to protect your own merchant terminal and customer reputation.

Source: American Banker — Top News

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