Attorney General files suit against loan company allegedly charging interest rates of over 300%
Michigan Attorney General Dana Nessel has filed a lawsuit alleging violations of the federal Consumer Financial Protection Act.
The Consumer Financial Protection Act was enacted in 2010 as part of federal reforms following the 2008 financial collapse.
In her lawsuit the Attorney General alleges that Sierra Financial, a tribal loan company, has charged interest rates of more than 300%.
Dan Olsen is with the Attorney General’s Office. He said when they sought more information from the company Sierra Financial claimed Michigan law does not apply because of its relationship to a California tribe.
“Federal law has been clear, as asserted in our complaint, that Native Americans operating outside of the tribal boundaries are subject to any and all applicable laws here in the state, and the federal laws as well.”
In addition to the lawsuit Nessel also filed for a preliminary injunction against the company.
“Using a tribal status to circumvent our state and federal laws designed to protect our residents is not going to be tolerated by the Michigan attorney general’s office,” Olsen said. “Predatory lenders have no place here in our state and our department will use every resource to protect our residents from extortive tactics. This is just one of the ways that we’re doing it.”
Sierra Financial did not respond to our request for comment.