The Connecticut Department of Banking has entered into a consent order with TrueAccord for a number of alleged violations, including collecting on loans that violated state usury laws, commingling funds from its business account with funds in its trust accounts, and advertising financial products and services of unlicensed affiliates in communications with consumers.
TrueAccord has agreed to pay a fine of $10,000, refund some of the funds it collected, cease and desist from soliciting financial services products in its communications with consumers, and implement appropriate policies and procedures.
A copy of the consent order can be accessed by clicking here.
Under the consent order, TrueAccord neither admits nor denies any of the allegations, and is prohibited from making statements that deny any allegation referenced in the order or create the impression that the order was without factual basis. Rather than contesting the case, TrueAccord voluntarily agreed to the consent order to obviate the need for a formal administrative proceeding.
The allegations were found during an examination of TrueAccord, according to the consent order. The examination found that, between January 2015 and June 2016, TrueAccord collected on loans made by lenders affiliated with Native American tribes that charged interest rates in excess of state law, and that between July 2016 and November 2020, the company received payments on loans that violated other state statutes. The Connecticut Department of Banking, pursuant to a state Supreme Court decision, prohibits consumer collection agencies from collecting on small loans made by unlicensed persons, including lenders affiliated with Native American tribes and considers those loans void and unenforceable.
Should the Department had gone forth with enforcement proceedings, TrueAccord could have faced penalties of $100,000 per violation.
