Lawsuit Challenges DFPI's Threat To Enforce Fair Access To Credit Act

Last week, Opportunity Financial, LLC filed a lawsuit challenging the Department of Financial Protection & Innovation's alleged threat to take enforcement action for violating AB 539, the so-called Fair Access to Credit Act.  Enacted in 2019, AB 539 imposes an interest rate cap on consumer loans between $2,500 and $10,000 made by lenders licensed under the California Financing Law. 

Opportunity Financial's complaint rests on the assertion that the allegedly offending loans were and are being made by a Utah bank.  As such, the complaint asserts that the loans are statutorily exempt and that the plaintiff is not a lender within the meaning of the CFL.  In February, Judge Jeffrey S. White ruled against the State of California's challenge to the Federal Deposit Insurance Corporation's Interest Rate Authority Rule, which provides that whether interest is permissible is determined when the loan is made and is not affected by the sale or assignment of the loan.  California v. FDIC, 2022 U.S. Dist. LEXIS 22719. 

Today in Literary History

SOOTHSAYER - Beware the ides of March.

CAESAR -What man is that?

BRUTUS - A soothsayer bids you beware the ides of March.

CAESAR - Set him before me; let me see his face.

CASSIUS - Fellow, come from the throng; look upon Caesar.

CAESAR - -What say'st thou to me now?  Speak once again.

SOOTHSAYER - Beware the ides of March.

CAESAR - He is a dreamer; let us leave him: pass.

Wm. Shakespeare, Julius Caesar, Act I, sc. 2.