HARRISBURG, PA — Pennsylvania Attorney General Dave Sunday has announced a settlement with Kansas-based debt collection company TrueAccord Corp., resolving allegations of illegal tribal lending practices that violated state consumer protection laws.
Under the terms of the settlement, TrueAccord will pay $23,400 in restitution, with over 200 Pennsylvanians eligible to receive payments. The company will also pay $5,000 in civil penalties, modify its business practices, and cease any collection efforts linked to tribal lending enterprises.
Tribal lending enterprises often target consumers ineligible for traditional loans, exploiting a structure that bypasses state regulations, including interest-rate caps. “My office is very astute to illegal tribal lending practices and has taken legal action in numerous instances when consumers were exploited with high-interest loans,” Attorney General Sunday said. “I encourage all Pennsylvanians to do their due diligence when it comes to finding short-term funding solutions.”
According to the Attorney General’s Office, TrueAccord collected on online payday loans made by lenders claiming Native American tribal affiliations. These loans violated Pennsylvania’s Loan Interest and Protection Law and Consumer Discount Company Act, which set statutory limits on interest rates. Furthermore, the company allegedly misrepresented the legal status of these debts, contravening the Fair Credit Extension Uniformity Act.
TrueAccord has since ceased collecting on loans from tribal lenders, closed all related loan accounts, and agreed to implement business practices to ensure compliance with Pennsylvania laws moving forward.
The restitution will be distributed to approximately 234 affected Pennsylvania consumers, who do not need to take any action to receive payments. Notices will be issued by the Attorney General’s Office.
Consumers who believe they were harmed by TrueAccord, a usurious lender, or another business should file a complaint or contact the Attorney General’s Office at 1-800-441-2555 or scams@attorneygeneral.gov.
The settlement agreement was filed by Senior Deputy Attorney General Debra Djupman Warring in the Philadelphia Court of Common Pleas.
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