State or Local Government Enforcement Action

This is a September 26, 2024 assurance of discontinuance brought by the Massachusetts Attorney General in state superior court against Franklin Credit Management for its zombie second mortgage practices.  The state alleged violation of state law by Franklin improperly attempting after many years to collect on second mortgages after failing to communicate with borrowers or provide required statements, as well as failing to comply with state foreclosure-prevention measures and collecting on time-barred debt.

This is a state court action claiming violation of the state UDAP statute, brought by the Pennsylvania attorney general. The complaint alleges unlawful and deceptive practices in connection with the sale and financing of severely distressed and dilapidated homes to consumers, utilizing agreements that purport to grant defendants all the rights and benefits of being both a lender and a landlord, while leaving their economically distressed and vulnerable customers without the legal protections of being either borrowers or tenants.

This is a 2019 federal action claiming violation of the federal Consumer Protection Act and New York law, brought by the New York attorney general and the New York supervisor of financial services.

This is a state UDAP action brought by the North Carolina attorney general for an injunction, restitution, and civil penalties involving the purchase and lease back of real property that utilized misrepresentations and other unfair and deceptive practices targeting and exploiting vulnerable consumers, most of whom were experiencing financial distress and/or other personal hardships.

This is a charge letter sent by the Maryland Commissioner of Financial Regulation to Fortiva Finanical, Bank of Missouri, and Atlanticus warning them of an administrative hearing concerning unlicensed lending activity involving instalment loans.  Even if Bank of Missouri was the true lender, and could avoid the licensure requirement, Fortiva and Atlanticus under Maryland law were required to obtain a license to assist consumers in obtaining a loan extension and to collect on such loans.

This is a settlement of an administrative action before the California Department of Business Oversight where the department claimed that litigation advance contracts were loans under California law and that the company’s offerings violated California loan law.

The California Superior Court denies a high-cost installment loan creditor's (Opportunity Financial) attempt to dismiss a cross-complaint brought by the state alleging that the creditor was not the true lender in a rent-a-bank scheme with Finwise. The case is notable for a discussion of other cases dealing with whether a bank in a rent-a-bank scheme is the  true lender.