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CFPB, State of S.C. sue brokers of High-Interest Credit Offers
On Tuesday, October 1, 2019, the CFPB and the South Carolina Department of Consumer Affairs issued a press release regarding a lawsuit filed in federal district court in the District of South Carolina against Katharine Snyder, Performance Arbitrage Company, Inc., and Life Funding Options, Inc. The companies, owned and operated by Snyder, brokered contracts offering high-interest credit to veterans, many of whom are disabled, and to other consumers. The Bureau alleges that the companies and their owner violated the Consumer Financial Protection Act’s prohibition against deceptive acts or practices.
The Bureau and South Carolina specifically allege that Snyder and her companies misrepresented to consumers that the contracts the companies broker are valid and enforceable when, in fact, the contracts are void under federal and state law; misrepresented to consumers that the product is a sale of payments and not a high-interest credit offer; and failed to inform consumers of the products’ interest rates. The complaint seeks an injunction against Snyder and her companies, redress to consumers, and the imposition of a civil money penalty.
A copy of the complaint filed in the United States District Court for the District of South Carolina is available here: https://files.consumerfinance.gov/f/documents/cfpb_snyder-et-al_complaint_2019-10.pdf