Oregon — The Oregon Division of Financial Regulation has issued a cease-and-desist order against Wheels Financial Group LLC, doing business as LoanMart, for facilitating consumer finance loans that exceeded Oregon’s legal interest rate cap.
State regulators found that LoanMart arranged loans charging interest rates far above Oregon’s 36 percent limit, in some cases ranging from 126 percent to 178 percent. The violations occurred between 2019 and 2023 and were carried out through an arrangement with an out-of-state bank, commonly known as a “rent-a-bank” scheme.
Under the terms of the final order, LoanMart agreed to remedy all illegal loans and repay approximately $900,000 in excessive interest charges to affected Oregon consumers. The order also assessed $660,000 in civil penalties, which will be suspended and waived after three years provided the company fully complies with all conditions.
Regulators also cited unlawful provisions in LoanMart’s loan agreements, including attorney fee clauses that exceeded what is permitted under Oregon consumer finance law and hold-harmless provisions that are prohibited. In some cases, borrowers could have been required to pay attorney fees for lawyers who were salaried employees of LoanMart.
The order applies equally to LoanMart’s affiliate, WFG Purchaser LLC, which purchased a substantial majority economic interest in the loans despite not holding a consumer finance license. Because of that, regulators determined WFG was prohibited from collecting or retaining any interest, fees, or charges connected to the loans.
“Consumer finance companies cannot hide behind out-of-state banks to bypass Oregon’s consumer protection laws,” said TK Keen, administrator of the Division of Financial Regulation. “We will continue to take steps to police our market to ensure that Oregonians get a fair shake when it comes to borrowing money.”
State officials said the enforcement action underscores Oregon’s commitment to enforcing its interest rate cap and protecting consumers from predatory lending practices.
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