-
Eric Schneiderman, New York's top law enforcer, filed a suit Monday against three online lenders and their owners, alleging that they violated usury laws by making loans that carry annual interest rates of between 89% and 335%.
August 12 -
A federal court has ruled that state regulators have the authority over online lenders that operate from Native American land.
October 1 -
The state has reached a settlement with five payday lenders under which they would be prevented from collecting on certain loans and pay restitution to customers, Eric Schneiderman's office announced Monday.
September 30
New York State's crackdown on online lenders has ensnared a Chicago company that makes loans backed by a borrower's car.
State Attorney General Eric Schneiderman fined the auto-title lender Manor Resources more than $33,000 Monday for violating the New York's interest-rate cap. Schneiderman also ordered the lender to forgive the balance of all its New York loans, a sum estimated at $28,000, according to a spokeswoman for the attorney general's office.
In addition, Schneiderman announced that loan agreements in New York cannot include mandatory arbitration clauses, which stipulate that all disputes between borrower and lender must be handled through arbitration rather than the courts. Manor Resources' loan contracts included such clauses, the state said.
Manor Resources allegedly charged borrowers 10% a month for short-term loans secured by a right to own a borrower's car in case of default. New York law sets the maximum annual rate for a loan of $25,000 or less at 25% for companies licensed by the state's Department of Financial Services (DFS), and 16% for all others.
"New York is not open for business to predatory online lenders, and Manor is just the latest company to learn that lesson," Schneiderman said in a news release.
Recent efforts by Schneiderman, as well as Department of Financial Services Superintendent Benjamin Lawsky, have made New York among the states most aggressively pursuing online small-dollar lenders.
In August, Schneiderman's office
In September, Schneiderman's office
