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MoneyLion and the Consumer Financial Protection Bureau (CFPB) have reached a settlement regarding allegations that MoneyLion imposed illegal and excessive charges on military service members and their families. The agreement aims to resolve the lawsuit and includes both injunctive and monetary terms, with a proposed judgment expected to be submitted to the court soon.
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Overview of the Settlement
The Consumer Financial Protection Bureau (CFPB) and MoneyLion have reached a settlement regarding allegations of unfair charges against military personnel. This agreement addresses claims that MoneyLion imposed illegal fees and made it difficult for service members to cancel subscriptions tied to loan access.
Key Details of the Settlement
Allegations Against MoneyLion
- Excessive Charges: MoneyLion was accused of charging fees that exceeded the Military Lending Act’s (MLA) cap of 36% annual percentage rate (APR) for loans to service members and their dependents.
- Membership Fees: The CFPB alleged that MoneyLion required customers to pay monthly membership fees to access loans, which contributed to the overall cost exceeding legal limits.
Terms of the Settlement
- Injunctive Relief: The settlement includes provisions to prevent MoneyLion from continuing the alleged unfair practices.
- Monetary Terms: Specific financial penalties or restitution details have not been disclosed but are part of the agreement.
Implications of the Settlement
This settlement is significant as it highlights the CFPB’s ongoing commitment to protecting military personnel from predatory lending practices. It also reflects a broader trend of increased scrutiny on fintech companies regarding their lending practices, especially towards vulnerable populations.
The agreement is expected to be finalized in court by early November 2025.
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