Business ProfileforDriver Loan, LLC

The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government's allegations, which have not yet been proven.

UPDATE: As of May 27, 2021:
The Consumer Financial Protection Bureau (CFPB) today filed a proposed settlement against Driver Loan, LLC, and its CEO, Angelo Jose Sarjeant. If entered by the court, the settlement would require the defendants to refund about $1 million in deposits to harmed consumers, stop deceptive practices, and pay a civil penalty. The CFPB alleges that Driver Loan and Sarjeant violated federal law by misrepresenting the risks associated with their deposit product and the annual percentage rate (APR) associated with the consumer loans they make.

Driver Loan, based in Doral, Florida, offers short-term, high-interest loans to consumers funded by deposits made by other consumers. The proposed settlement seeks to resolve a pending lawsuit against Driver Loan and Sarjeant filed in federal district court in Florida in November 2020.

The CFPB alleges that Driver Loan and Sarjeant engaged in deceptive acts or practices in violation of the Consumer Financial Protection Act of 2010 (CFPA). The allegations center around:

Hiding risks about their loan deposit product: The CFPB alleges that, in 2020, Driver Loan began taking deposits from consumers to fund the loans it makes. Driver Loan represented to consumers that their deposits would have a fixed and guaranteed 15% annual percentage yield, and were deposited at FDIC-insured institutions. The CFPB alleges that Driver Loan's representations were false: the funds were not held in FDIC-insured accounts, and the rate of return was not 15% APY. The CFPB also alleges that most deposited funds are lent to borrowers at rates that violate Florida's criminal-usury law, rendering the loans uncollectable and creating substantial risk that obligations could not be met to depositors who sought to withdraw their deposited funds.
Hiding the actual interest rate: The CFPB alleges that, since 2017, Driver Loan has offered short-term, high-interest personal loans, totaling more than $30 million, typically to drivers who work with ride-share companies. The loans have ranged from $100 to $500 each and are repayable in 15 daily installments. The CFPB also alleges that Driver Loan deceptively markets its loans as having an APR of 440% when the actual APRs are over 900%.

Link:
https://www.consumerfinance.gov/about-us/newsroom/cfpb-takes-action-against-company-and-its-ceo-for-deceptive-deposit-and-loan-products/


On November 5, 2020, in the U.S. District Court for the Southern District of Florida; case #1:20-cv-24550-DLG;
and
On November 5, 2020, the Consumer Financial Protection Bureau (Bureau) filed a lawsuit against Driver Loan, LLC and its Chief Executive Officer, Angelo Jose Sarjeant, for violations of the Consumer Financial Protection Act of 2010 (CFPA).

Driver Loan is a limited-liability company based in Doral, Florida that offers short-term, high-interest loans to consumers funded by deposits made by other consumers.

The Bureau's complaint alleges that Driver Loan and Sarjeant engaged in deceptive acts or practices that violated the CFPA by misrepresenting the risks associated with the deposit product offered to consumers and by misrepresenting the annual percentage rates associated with extensions of offered to other consumers.

The Bureau seeks an injunction against Driver Loan and Sarjeant to stop their alleged unlawful conduct, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties.

The matter remains pending.

For more information contact:
Consumer Financial Protection Bureau
P.O. Box 2900
Clinton, IA 52733-2900

Mail all other correspondence
Consumer Financial Protection Bureau
1700 G St. NW
Washington, DC 20552
(855) 411-2372

Link:
https://www.consumerfinance.gov/policy-compliance/enforcement/actions/driver-loan-llc-angelo-jose-sarjeant/