Category Archives: Criminal Usury

Administrative Order Related to Alleged Usury Violations Unenforceable Against Indian Tribe

In October 2014, the Connecticut commissioner of banking sent a cease and desist order to two limited liability companies allegedly created by a federally recognized Indian tribe. The commissioner alleged that the companies had made usurious consumer loans and had operated … Continue reading

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Borrowers’ Equitable Recoupment Claim Fails, Criminal Usury Claim Survives

Plaintiff-borrowers filed a complaint against the defendant-lender alleging that the lender had made four usurious loans to the borrowers. The borrowers sought to recoup allegedly usurious interest payments they had paid on a satisfied loan and to void three outstanding loans. … Continue reading

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Defendants Neglect to Allege Usurious Intent, Criminal Usury Defense Fails

A creditor purchased two convertible promissory notes from a company. The notes bore interest at 8% and 10%, respectfully. At the creditor’s option, the notes could be converted into unrestricted common stock of the company. After the purchase, the creditor elected to convert … Continue reading

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Court Finds Usurious Late Fees Unenforceable

Though usury caps are only applicable to loan transactions, courts often reference usury rates when determining the reasonableness of fees charged on amounts due. A fee that significantly exceeds the applicable usury rate may be found to be an unenforceable penalty … Continue reading

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Multiple State Regulators Challenging Lender’s Use of Choice of Law Clause in Usury Enforcement Actions

A growing number of state regulators are challenging the use of choice of law provisions as a method of usury law compliance. On August 27, 2015, the Attorney General of North Carolina was granted an injunction against Western Sky Financial … Continue reading

Posted in Attorney General, Choice-of-Law, Civil Usury, Criminal Usury, D.C., Massachusetts, North Carolina, Tribal Immunity | Comments Off on Multiple State Regulators Challenging Lender’s Use of Choice of Law Clause in Usury Enforcement Actions

Alternative Small Business Lender Successfully Defends Against Usury Claim

A recent decision out of Westchester County, New York provides support for the enforceability of choice-of-law clauses in New York state where claims of usury are involved. The decision is especially noteworthy following the 2nd Circuit’s ruling in Madden v. Midland Funding, LLC, which … Continue reading

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DOJ Files Rico Charges Against Payday Lender, Attacks “Rent-A-Bank” & “Rent-A-Tribe” Tactics

On Monday, the US Attorney’s Office for the Eastern District of Pennsylvania charged Adrian Rubin of Jenkintown, PA, with one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act, one count of conspiracy to commit mail fraud and wire … Continue reading

Posted in Assignor-Assignee, Choice-of-Law, Criminal Usury, Federal Court, RICO | Comments Off on DOJ Files Rico Charges Against Payday Lender, Attacks “Rent-A-Bank” & “Rent-A-Tribe” Tactics

Another New York Court Finds Usurious Interest Rate Contrary to Public Policy

Pisane v Feig, 2015 N.Y. Misc. LEXIS 1722 (N.Y. Sup. Ct. May 19, 2015) A case out of Kings County, New York, involving two former business partners that had dissolved their corporation. Pursuant to the dissolution proceedings, the defendant was … Continue reading

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Usury Defense Voids Commercial Loan

Fred Schutzman Co. v Park Slope Advanced Med., PLLC, 2015 N.Y. App. Div. LEXIS 4373 (N.Y. App. Div. 2d Dep’t May 27, 2015) Plaintiff loaned defendant $52,900 at an annualized interest rate of 60%. When defendant defaulted, plaintiff sued to … Continue reading

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Erroneous Interest Calculation Dooms Criminal Usury Defense

Madison Park Invs. LLC v 488-486 Lefferts LLC, 2015 N.Y. Misc. LEXIS 320 (N.Y. Sup. Ct. Feb. 5, 2015) The plaintiff Madison Park Investors, LLC (“Madison”) commenced this action to foreclose on a commercial mortgage on real property.  David Marom … Continue reading

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