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FTC Lawsuit Highlights the Importance of Accuracy in Online Loan Advertising and Application Process

A lawsuit filed on April 25th by the Federal Trade Commission (“FTC”) against LendingClub Corporation (“LendingClub”) shows how promotional language used in attracting online borrowers can get a company in legal trouble if misleading or inaccurate. The FTC’s complaint alleges that LendingClub promised “no hidden fees” in print and online advertising, yet deducted an up-front fee before disbursing loan funds to borrowers. The FTC’s lawsuit also examines in detail the various pop-up bubbles and other features that the online loan platform used in the application process to disclose fees, noting that a consumer was unlikely to learn of the existence of the fees based on how such pop-up bubbles and other features worked. The FTC …

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