A US District judge rules against AMG Services. AMG processed upwards of 5 million loans. The entity was partnering with a Native American tribe and believed they had sovereign immunity. The judge ruled that the FTC Act grants the agency authority to regulate arms of Indian tribes, their employees, and their contractors. This creates a conundrum of how Native American Tribes can safely lend online, if all their vendors are in the line of fire?
Here is what the Judge found:
- Violated the FTC Act by piling on undisclosed and inflated fees, and by threatening borrowers in debt collection calls with arrest and lawsuits.
- The defendants violated the Truth in Lending Act by giving inaccurate loan information to borrowers,
- ….and the Fund Transfer Act by requiring consumers to preauthorize electronic withdrawals from their bank accounts as a condition of obtaining credit, according to the FTC.
