Illinois AG and IDFPR reach agreement with three payday lenders
On November 5, the Illinois Attorney General and the Illinois Department of Financial and Professional Regulation (IDFPR) announcement a settlement resolving allegations that three companies violated Illinois loan laws by generating unlicensed payday loan leads and arranging high-cost payday loans for unlicensed payday lenders out of the lender ‘State. The AG and the IDFPR further alleged that the companies falsely portrayed their lending network as “trustworthy,” although the terms of the loan did not comply with Illinois law, which violated Illinois Consumer Fraud and Deceptive Marketing Practices Act. The AG sued the companies in 2014 after the companies refused to comply with a cease and desist order issued by the IDFPR, which required them to obtain a license. According to the announcement, under the terms of the settlement, companies are prohibited from: (i) arranging or offering small loans, online or otherwise, without being approved by the IDFPR; (ii) advertise or offer small consumer loan deals or lead generation services in Illinois, unless authorized by the IDFPR; and (iii) provide services associated with arranging or providing small dollar loans to consumers in Illinois without being licensed by the IDFPR.