OppFi Keeps Fighting to Legalize Loan Sharking

Fintech lender battles in California to charge 160% interest rates

Andy Spears


Photo by Chase Baker on Unsplash

I wrote back in March about fintech lender OppFi’s California quest to keep charging 160% interest rates in defiance of state law.

More recently, OppFi has come under fire in Texas for using a “rent-a-bank” scheme to issue loans with 130% interest rates:

Now, the California case is moving forward — and Jason Mikula at Fintech Business Weekly reports on how that’s going:

California DFPI’s latest filing details the agency’s opposition to OppFi’s demurrer, which asked the court to block the DFPI’s attempt to apply California usury law to the loans in question.

According to JDSupra’s analysis of the DFPI filing (emphasis added):

“[T]he DFPI cites various authorities in support of its assertion that for more than a century, ‘California law has recognized the principle of looking at substance over form in evaluating usury claims and does not permit evasion of usury laws through disguise or subterfuge.’

It also cites cases from other courts, including a California federal district court’s decision in CashCall, that have used a ‘true lender’ analysis to uphold usury challenges.”

In short, a predatory fintech lender is using a willing bank partner to offer loans to vulnerable consumers at outrageous (and usurious) rates. Now, they’re being called out — and rather than backing down, OppFi is doubling down — suing for the right to profit from the pain of struggling consumers.

MORE on Fintech Lenders and Rent-a-Bank Usury

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Andy Spears

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