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Utah Bank Called Out for Laundering Loans for Payday Predator
FinWise partnered with lender charging 149% interest
The District of Columbia yesterday announced a settlement with online lender Elevate that will refund millions of dollars to consumers. The agreement was reached as a result of Elevate violating interest rate caps in DC — the maximum rate for a loan there is 24%.
In order to get around the rate cap, Elevate partnered with a Utah bank known as FinWise. Utah’s ABC4 has more:
Elevate Credit, Inc. (Elevate) was laundering loans with up 149% APR to D.C. consumers through Utah FinWise Bank to evade DC’s interest rate limits.
Elevate was charging 99% to 149% interest on installment loans in DC despite the District’s 24% interest rate cap.
Consumer advocates were quick to condemn FinWise for their complicity in the rent-a-bank scheme:
“Utah’s FinWise Bank was helping the predatory lender Elevate to make loans up to 149% APR that are illegal in DC, but the DC Attorney General showed that states can stop rent-a-bank schemes enabled by rogue Utah banks,” said Lauren Saunders, associate director at the…
