Attorney General Phil Weiser announces $350,000 settlement with lender MoneyLion over illegal consumer loan fees
Nov. 14, 2023 (DENVER) – Attorney General Phil Weiser today announced a settlement with consumer lender MoneyLion after an investigation by the Colorado Department of Law found the company collected illegal membership fees from Colorado consumers tied to loans. The settlement includes $271,000 in restitution for Coloradans.
MoneyLion claimed in marketing materials that consumers could obtain loans as low as 5.99% APR. However, these rates were only available if consumers paid monthly membership fees ranging from $19.99 to $29.99. Though the company said the memberships could be canceled at any time, the company prohibited consumers from canceling their memberships once they took out loans. The investigation found this practice violates the Colorado Uniform Consumer Credit Code.
“In Colorado, we are vigorously protecting consumers from companies that charge illegal lending fees,” Weiser said. “When companies hide the true cost of credit from consumers and lock them into expensive, illegal loans, we will hold them accountable under the law for their unscrupulous practices.”
Under the settlement, MoneyLion agreed to refrain from lending in Colorado under this membership model. MoneyLion also agreed to return $271,000 to Colorado consumers and pay the Attorney General’s office $75,000 that can be used for any restitution where possible, consumer or creditor education, consumer credit or consumer protection enforcement, or efforts to advance the public welfare.
Borrowers who are having issues with their loan or lender can file a complaint with the Colorado Attorney General.
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