The Massachusetts Division of Banks has assessed a $1.5 million fine against a company for acting as a third party loan servicer in the state without the appropriate license to do so.
A copy of the consent order with Bill Me Later can be accessed by clicking here.
The company submitted an application with the Division of Banks in June 2022 to register as a third party loan servicer. While reviewing the application, the Division “became aware” that the company had already engaged in the business of third party loan servicing in Massachusetts without the appropriate registration.
To settle that claim, Bill Me Later has agreed to pay the state $1.5 million. It has also represented to the Division of Banks that it has ceased all business activity that requires licensing or registration from the Division so it can obtain the appropriate license or approval to operate as a third party loan servicer. The same section of Massachusetts state law that requires third party loan services to be registered also requires debt collectors to be registered as well. The statute says:
No person shall directly or indirectly engage in the commonwealth in the business of a debt collector, or engage in the commonwealth in soliciting the right to collect or receive payment for another of an account, bill or other indebtedness, or advertise for or solicit in print the right to collect or receive payment for another of an account, bill or other indebtedness, without first obtaining from the commissioner a license to carry on the business
Bill Me Later is also required to establish, implement, and maintain adequate internal policies and procedures to ensure that it refrains from engaging in any business activity that requires licensing or registration from the Division of Banks prior to obtaining the appropriate license. Bill Me Later is a unit of PayPal and is now more commonly known as PayPal Credit. It allows consumers to make purchases of retail goods without needing a credit card.
