In 2015, the CFPB filed a lawsuit against NDG Financial, Northway Financial and Northway Broker for “illegally collecting loan amounts and fees that were void or that consumers had no obligations to repay.” The companies allegedly falsely threatened borrowers with “lawsuits and prison.” The regulators are seeking a penalty and restitution for victimized consumers. The case is open as of February 28, 2017.

• The lawsuit named “NDG Financial Corp., Northway Financial Corp. Ltd., Northway Broker Ltd., E-Care Contact Centers Ltd., Blizzard Interactive Corp., Sagewood Holdings Ltd., New World Consolidated Lending Corp., New World Lenders Corp., Payroll Loans First Lenders Corp. and New World RRSP Lenders Corp. All of the defendants, except for Northway Financial and Northway Broker, are Canadian corporations.” “The NDG Enterprise,” as the companies are collectively referred, “originates and collects payday loans over the Internet to consumers in all 50 states, including New York where those loans are void because they violate state usury caps and licensing requirements.” [Darren Waggoner, “Payday Lender Sued for Illegal Collections,” American Banker, 08/04/15]

• “Under state law,” according to the CFPB, “consumers had no obligation to repay the loans in question that were made by NDG Enterprise. But NDG Enterprise told consumers expressly or by implication that they were obligated to repay loan amounts and fees that they did not actually owe.” On many occasions, “the defendants falsely represented to consumers that non-payment of debt would result in lawsuit, arrest, imprisonment or wage garnishment, despite lacking the intention or legal authority to take such actions.” [Darren Waggoner, “Payday Lender Sued for Illegal Collections,” American Banker, 08/04/15]

• The CFPB’s lawsuit seeks “to end the companies’ alleged illegal practices and obtain monetary relief for consumers.” The case is open as of February 28, 2017. [Darren Waggoner, “Payday Lender Sued for Illegal Collections,” American Banker, 08/04/15]