On August 3, 2022, the California Department of Financial Protection and Innovation (DFPI) announced that it had entered into a consent order with a Florida-based lending company that allegedly made "illegal loans." Specifically, the consent order alleges that the company's policy of making "buy now, pay later" arrangements for point-of-sale transactions qualified as "loans," subjecting the arrangements to DFPI's jurisdiction under California Financial Code ยง 22000 et seq. The DFPI further alleged that the company entered in to such transactions without obtaining a license from the DFPI.
The order assesses a $2,500 administrative penalty and requires the company to refund $13,065.68 that it charged in fees. In exchange, DFPI granted the company a California lending license.
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