Nexus Services and Libre by Nexus were accused of fraudulent loan practices. The court awarded the CFPB and state attorneys general from Virginia, Massachusetts and New York millions in restitution and penalties against the two companies.
05/01/2024 1:00 P.M.
1 minute read
In a recent court decision, the U.S. District Court for the Western District of Virginia awarded the Consumer Financial Protection Bureau and the attorneys general of Virginia, Massachusetts and New York almost $367 million in restitution and penalties against two companies, Nexus Services Inc. and Libre by Nexus Inc., and their principals for violations of the Consumer Financial Protection Act, the Virginia Consumer Protection Act, the Massachusetts Consumer Protection Act, and the New York General Business Law.
The violations stemmed from loans offered by the companies to immigrants to pay detention bonds.
After granting the plaintiffs a default based on the defendants’ failure to faithfully participate in discovery, the court found all defendants jointly and severally liable in the following amounts:
- $230,996,970.84 in restitution to the CFPB;
- $111,135,620 as a civil monetary penalty to the CFPB;
- $7,100,000 as a civil monetary penalty to the Commonwealth of Virginia;
- $3,400,000 as a civil monetary penalty to the Commonwealth of Massachusetts and
- $13,890,000 as a civil monetary penalty to the state of New York.
The court found the defendants were not entitled to any mitigation of the damages based on their conduct. While the defendants tried to argue that their business was novel and untested, the court found that argument unpersuasive: “[J]ust because a business practice is ‘novel’ does not mean that it is exempted from consumer protection laws.”
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