Are lenders allowed to charge nearly 700% in interest? Not under Illinois state laws. But two entities—Makes Cents, Inc. and Uetsa Tsakits, Inc. (UTI)—who make such loans through the website www.MaxLend.com, purport to be owned by the Mandan, Hidatsa, and Ankara Nation, and to therefore be entitled to tribal sovereignty and tribal immunity. The complaint for this class action alleges that this is merely a “rent-a-tribe scheme” where a Native American tribe is a front for non-Native American individuals and entities to make predatory loans.
The complaint proposes a class for each count in the complaint, most of which include (1) all individuals with Illinois addresses (2) two whom a loan was made in the name of MaxLend at more than 9% interest (3) on or after March 23, 2021.
According to the complaint, MaxLend’s website domain was first registered in 2005. Until 2013, the complaint alleges, it bore an address in Belize and made no reference to any tribe or tribal ownership. The complaint alleges, “In early 2014, MaxLend ‘moved’ from supposedly being an offshore lender in Central America to being a purported tribal lender in rural North Dakota.”
The complaint alleges that “the Tribe has no significant involvement in the operation of the lending business” and that “the principal economic benefit of the activities of MaxLend is received by non-Native American persons.” David Johnson, Kirk Michael Chewning, and “a web of interconnected companies, culminating with” Cane Bay Partners VI, LLLP, a US Virgin Islands entity. These three, along with Makes Cents/MaxLend and Uetsa Tsakits, are the defendants in this case.
The complaint claims that MaxLend made a $400 loan to the plaintiff in this case, Lauren Combs, over the Internet, on April 10, 2021, “at a disclosed annual percentage rate of 699.77%.”
Combs lives in Illinois, but the complaint asserts, “[a]t no time have Defendants had a license from the Illinois Department of Financial and Professional Regulation or a state or federal banking or credit union charter, entitling them to make loans to Illinois residents at more than 9% interest.” Combs has made payments on her loan, and still purportedly owes money on it.
The Illinois Predatory Loan Prevention Act, the complaint says, “made it unlawful for anyone other than a bank to make loans to Illinois residents at annual percentage rates in excess of 36%. The complaint quotes it as saying, “Any loan made in violation of this Act is null and void and no person or entity shall have any right to collect, attempt to collect, receive, or retain any principal, fee, interest, or charges related to the loan.”
According to the complaint, the courts have now developed a framework of things to be considered to determine whether entities are truly tribal or not.
The counts include violations of Illinois state laws and the Racketeer Influenced and Corrupt Organizations (RICO) Act.
Article Type: LawsuitTopic: Loans
Most Recent Case Event
MaxLend “Rent-a-Tribe” Payday Loans Illinois Complaint
January 6, 2022
Are lenders allowed to charge nearly 700% in interest? Not under Illinois state laws. But two entities—Makes Cents, Inc. and Uetsa Tsakits, Inc. (UTI)—who make such loans through the website www.MaxLend.com, purport to be owned by the Mandan, Hidatsa, and Ankara Nation, and to therefore be entitled to tribal sovereignty and tribal immunity. The complaint for this class action alleges that this is merely a “rent-a-tribe scheme” where a Native American tribe is a front for non-Native American individuals and entities to make predatory loans.
MaxLend “Rent-a-Tribe” Payday Loans Illinois ComplaintCase Event History
MaxLend “Rent-a-Tribe” Payday Loans Illinois Complaint
January 6, 2022
Are lenders allowed to charge nearly 700% in interest? Not under Illinois state laws. But two entities—Makes Cents, Inc. and Uetsa Tsakits, Inc. (UTI)—who make such loans through the website www.MaxLend.com, purport to be owned by the Mandan, Hidatsa, and Ankara Nation, and to therefore be entitled to tribal sovereignty and tribal immunity. The complaint for this class action alleges that this is merely a “rent-a-tribe scheme” where a Native American tribe is a front for non-Native American individuals and entities to make predatory loans.
MaxLend “Rent-a-Tribe” Payday Loans Illinois Complaint