Colorado Attorney General’s Office Settles Lawsuit Against Online Lenders including Avant and Marlette
Posted on 08/19/2020
Colorado Attorney General Phil Weiser disclosed that his office has reached a settlement in two precedent-setting lawsuits involving Colorado’s right to enforce its interest rate limits on consumer loans to protect residents from predatory lending practices.
According to the press release, “Under federal law, certain out-of-state banks can lend in Colorado at interest rates that exceed Colorado’s limits. The Attorney General alleged that non-banks Avant and Marlette illegally partnered with two out-of-state banks—WebBank and Cross River Bank, respectively—in a scheme to “rent” those banks’ ability to lend above Colorado’s rate limits.
Under the settlement, WebBank, Cross River Bank, and all of their non-bank partners, including Avant and Marlette, have agreed to provide Colorado consumers with certain protections to ensure that they are making true banks loans. Additionally, they committed that they will not lend to Colorado consumers at rates above 36% and will provide consumers with other protections required by Colorado law. In addition, non-bank partners will maintain a Colorado lending license.
The companies will pay $1,050,000 to the State of Colorado for consumer protection efforts consistent with the settlement agreement. Furthermore, the companies will make a $500,000 contribution to the MoneyWi$er program, a partnership between the Attorney General’s Office and the Colorado Department of Education that supports K-12 financial education in Colorado.”
Founded in 2013 in Wilmington, Delaware, Marlette Funding, LLC operates an online marketplace lending platform, that offers personal installment loans under the Best Egg brand.
The cases are Fulford v. Avant of Colorado, LLC, Case No. 17CV30377 and Fulford v. Marlette Funding, LLC, Case No. 17CV30376, both filed in Denver District Court.
Keywords: Marlette Funding, LLC. Avant LLC.
