Tag Archives: Fines and Damages

Online Lender Fined for Requiring Repayment by AutoPay

In a March 16th decision, a federal magistrate judge in California ordered a lender to pay $500,000 in statutory damages under the Electronic Funds Transfer Act (“EFTA”) for conditioning online loans on borrowers’ agreements to repay such loans through automatic electronic funds transfers. Under the EFTA (15 U.S.C. §1693k), a lender may not condition an extension of credit on a consumer’s repayment by means of preauthorized electronic fund transfers (“EFTs”). The opinion in the case, Kempley v. Cashcall, Inc., notes that this is apparently the first court since the EFTA’s enactment to apply the EFTA’s civil damages provision in connection …

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