LendUp’s Loan Shark Shenanigans

The unraveling of a fintech short-term loan business has painful consequences

Andy Spears
2 min readJul 31, 2022


Photo by Alexander Mils on Unsplash

I’ve written before about fintech lender LendUp and its trouble with regulators — which really points to the trouble it had being an honest broker in the short-term loan space.

“LendUp was backed by some of the biggest names in venture capital,” said CFPB Director Rohit Chopra. “We are shuttering the lending operations of this fintech for repeatedly lying and illegally cheating its customers.”

As a result of the order, LendUp Loans has agreed to halt making any new loans and collecting on certain outstanding loans, as well as to pay a penalty, to resolve a September 2021 lawsuit alleging that it continued to engage in illegal and deceptive marketing in violation of a 2016 CFPB order.

An Update

Jason Mikula at Fintech Business Weekly has an update on LendUp as the company moves through the bankruptcy process.

LendUp, a once-highflying fintech “alternative” to payday lending, has quietly begun liquidating its remaining assets — including its neobanking subsidiary, Ahead Money.

Mikula notes:

The company was once a VC darling, winning investment from a virtual who’s who of top-tier firms like GV (Google’s venture arm), Andreessen Horowitz, Kleiner Perkins, and Y Combinator.

But a lack of focus on compliance led to early missteps — and regulatory actions from the CFPB and the California DBO (now the DFPI). Regulators argued LendUp violated multiple consumer protection laws, including by misleading its customers about how its products worked, understating the APR, and failing to report credit information as promised. The company ultimately entered into consent orders and paid a total of $6.3 million in fines and restitution to settle the matter.

Though the consent order appeared to put the matter behind LendUp, problems at the company seem to have…



Andy Spears

Writer and policy advocate living in Nashville, TN —Public Policy Ph.D. — writes on education policy, consumer affairs, and more . . .