US payday lender Enova has been fined $15 million by the Consumer Financial Protection Bureau (CFPB) and has been prohibited from offering short-term loans due to “widespread illegal conduct.”
The consumer watchdog reported that the online lender improperly withdrew funds from customers’ bank accounts without authorization, made misleading statements regarding loans, and canceled loan extensions. Enova has a history of such violations, having previously been fined $3.2 million in 2019 and ordered to enhance its compliance practices.
As a consequence of violating that order and continuing unlawful practices, Enova is now barred from providing certain consumer loans. The company is also required to provide restitution to affected consumers and link executive compensation to adherence to federal consumer financial protection laws.
“Enova chose to persist in disregarding the law after being caught exploiting its customers and breaching a law enforcement order,” stated CFPB director Rohit Chopra. “Today’s measures impose a $15 million penalty, restrict the company from specific business activities, and reform executive compensation.”
In response, Enova indicated that the issues impacted a small segment of its customers, stemming from “unintentional technical systems and processing errors that have since been resolved.” Ranning Li, president of consumer lending at Enova, reiterated the company’s commitment to addressing any errors in their systems, emphasizing ongoing investments in technology, compliance processes, and customer resolution mechanisms.