In February 2017, the CFPB and the State of New York sued RD Legal Funding LLC for allegedly “scamming” 9/11 first responders and NFL players who were awaiting court settlements related to occupational injuries. The suit alleged that the company misled the victims about the terms of the payments, specifically the interest rates. In one case, RD Legal “sought roughly $860,000 in total repayments” from a former New York City police officer who took out “$355,000 in advance” believing he would have to pay roughly 19% in interest. Loans exceeding 16% interest in the state of New York are considered void. Separately, in July 2016, the SEC announced charges against RD Legal Funding for misrepresenting the assets in two of their managed funds.

• The CFPB and the New York State Attorney General filed a lawsuit against RD Legal Funding LLC in US District Court for the Southern District of New York. [CFPB and NY Attorney General v. RD Legal Funding, case no. 1:17-cv-00890, filed 02/07/17]

• The suit accused RD Legal Funding of “scamming” 9/11 first responders by “luring them into costly advance deals on pending compensation and settlement payouts.” The company “allegedly “misled_police officers, firefighters and other first responders about the terms of the advance payments.” [Kevin McCoy, “Legal financial advance firm accused of scamming 9/11 heroes, NFL players,” USA Today, 02/08/17]

• The lawsuit also alleged that RD Legal Funding “similarly targeted former National Football League players diagnosed with Alzheimer’s disease and other playing career-related illnesses that made them eligible for payments from a class-action court settlement.” RD Legal transactions carried rates of “more than 250%.” [Kevin McCoy, “Legal financial advance firm accused of scamming 9/11 heroes, NFL players,” USA Today, 02/08/17]

• Elmer Santiago, a former New York City Police officer, received a $3.9 million settlement that resulted from the Zadroga Act. According to Santiago’s attorney, “Santiago received $355,000 in advances from RD Legal, believing he would have to pay a roughly 19% rate on the funds.” RD Legal sought $860,000 from Santiago once he received his award and, according to his attorney, Santiago offered to repay the $355,000 he received from RD Legal. [Kevin McCoy, “Legal financial advance firm accused of scamming 9/11 heroes, NFL players,” USA Today, 02/08/17]

• In July 2016, the SEC announced fraud charges against RD Legal for allegedly misrepresenting assets in two of their funds, and the SEC alleged that they had marketed the funds as investments in “financial resolutions linked to attorney’s fees in settled lawsuits” when, according to the SEC, the funds were invested in “unsettled cases, lawsuits unaffiliated with any law firm and other cases “‘for which collection was still subject to significant litigation risk.'” [Kevin McCoy, “Legal financial advance firm accused of scamming 9/11 heroes, NFL players,” USA Today, 02/08/17]

• Loans made in New York with interest rates exceeding 16% are void. [Kathryn Vasel, “Company accused of scamming 9/11 heroes out of millions,” CNN, 02/07/17]