- October 7, 2022
- Posted by: Bastion team
- Category: World News
On September 29, 2002, the Consumer Financial Protection Bureau (“CFPB”) filed a complaint against online lender MoneyLion Technologies, Inc, and several dozen of its subsidiaries (collectively, “MoneyLion”), alleging violations of the Military Lending Act (“MLA). The complaint alleges that MoneyLion (i) overcharged servicemember and their dependents by imposing fees that, together with stated interest rates, exceeded the MLA’s 36% Military Annual Percentage Rate (“MAPR”), (ii) failed to provide required disclosures, and (iii) included arbitration clauses prohibited by the MLA. The Bureau further alleges that servicemembers became “trapped” in MoneyLion’s membership program after taking out their loans, and were unable to cancel their membership – which required the payment of monthly fees – without first paying off their loans.
According to the CFPB, MoneyLion has offered loans since 2017 that consumers can access through its website and mobile app by enrolling in membership programs and paying monthly membership fees. The CFPB alleges MoneyLion told consumers over the course of several years that they had the right to cancel their memberships for any reason even though they had a policy of prohibiting consumers with unpaid loan balances from canceling their memberships. Beyond that, the complaint alleges that even after loan payoff, some consumers were unable to cancel their memberships until they had paid past, unpaid membership fees;…