The administrators of a Wisconsin Native American tribe are facing a class action lawsuit alleging that they charge payday loan customers with interest fees close to 700 percent.
Plaintiff Isiah Jones III says he borrowed money from the Lac Du Flambeau Tribe of Lake Superior Chippewa Indians internet lending business as he needed cash to cover certain household expenses. The tribe accepted JonesвЂ™ loan application and approved him for $400 with a 690% A.P.R., payable in 14 biweekly payments of $110.24, the LDF class action lawsuit states. After making payments totaling more than $1,000, Jones says he refused to make any more payments and the tribe accused him of defaulting on the loan. https://paydayloanadvance.net/payday-loans-ok/tulsa/ The payday loan class action lawsuit accuses the tribeвЂ™s board members of violating the Racketeer Influenced and Corrupt Organizations Act (RICO).
The LDF class action lawsuit also charges numerous board members with perpetuating a usury scheme.
For example, Jones argues that Joseph Wildcat, Sr., the president of the LDF tribe, вЂњis believed to have a role in the LDF TribeвЂ™s use of funds generated by its internet lending and loan servicing businesses, and he is believed to play a role in choosing board members for the LDF TribeвЂ™s business development corporation that services high interest loans for lending entities owned by the LDF Tribe and others.вЂќ The LDF class action states that вЂњIn 2010, the Pennsylvania Supreme Court held that internet lenders were doing business in Pennsylvania and had to comply with the CommonwealthвЂ™s banking laws and usury regulations.вЂќ
Jones also says that LDF board members knew about this ruling, but failed to change their lending practices to fit into PennsylvaniaвЂ™s interest rate laws.
In addition, the LDF class action lawsuit states вЂњThe Individual Defendants never sought to have any of the lending or loan servicing entities under their [control] apply for a license to lend in Pennsylvania or otherwise seek to comply with Pennsylvania law in connection with loans made to and collected from Pennsylvania borrowers.вЂќ