Facts

The Military Lending Act protects active-duty service members and their covered dependents with respect to extension of consumer credit. According to the MLA, the cost of consumer credit to a covered borrower may not exceed a Military Annual Percentage Rate of 36 percent. Defendant LendUp Loans, LLC is an online lender that offers single-payment and installment loans to consumers. Plaintiff Bureau of Consumer Financial Protection filed a complaint against defendant LendUp Loans, LLC for violation of the MLA in connection with defendant's extension of consumer credit.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendant violated the MLA by extending over 4,000 single-payment or installment loans to covered borrowers with an MAPR that was more than the 36 percent cap. In addition, plaintiff contended that defendant violated the MLA because the loan it extended to covered borrowers required them to submit to arbitration in case of any dispute. Lastly, plaintiff contended that defendant violated the MLA because it extended loans that failed to include the mandatory loan disclosure statement.

DEFENDANT'S CONTENTIONS: Defendant neither admitted nor denied plaintiff's contentions.

Result

In settlement of the claim, defendant agreed to pay $300,000 in consumer redress and a $950,000 civil penalty.