NetCredit, CashNetUSA Fined $15M for Consumer Deception

Advocate Andy

Company illegally debited customer accounts

The parent company of nonbank online lenders CashNetUSA and NetCredit has been fined $15 million and ordered to cease certain business activities.

Enova was penalized by the Consumer Financial Protection Bureau (CFPB) for illegally debiting consumer accounts and for other deceptive activity. Additionally, the CFPB noted that the company violated a 2019 enforcement order and now therefore must cease offering some types of short-term loans.

“Enova decided to keep flouting the law after it was caught taking advantage of its customers, and violated a law enforcement order,” said CFPB Director Rohit Chopra. “Today’s action imposes a $15 million penalty, bans the company from certain lines of business, and reforms executive compensation.”

In addition to withdrawing funds from customer bank accounts without consent, including withdrawing funds from accounts owned by the customer but for which the customer had not authorized withdrawals, Enova operating as CashNetUSA or NetCredit also cancelled promised loan extensions and withdrew unauthorized amounts from customer bank accounts.

The enforcement action requires Enova to reimburse in full all customers from whom it withdrew funds illegally. Additionally, the company must pay a $15 million fine. The company is also prohibited from offering closed-end consumer loans that must be substantially repaid within 45 days.

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Andy Spears is a middle Tennessee writer and policy advocate. He reports on news around public policy issues - education, health care, consumer protection, and more.

Nashville, TN

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