Fast-day loan hit by class action lawsuit alleging “Rent-a-Tribe” high-yield lending program

Fast Day Loans is facing a proposed class action lawsuit alleging that the payday lender broke Indiana law by making high-interest loans to state residents while purporting to be protected from liability by the sovereign immunity of a Native American tribe to be.

The 17-page lawsuit accuses the defendants – WLCC Lending FLD (which does business as Fast Day Loans); Wakpamni Lake Community Corporation; Wakpamni Lake Community Corporation II (operating as WLCC II); and three people – ran a so-called “rent-a-tribe” program.

According to the lawsuit, these types of operations involve a payday lender pretending to be operated by a Native American tribe — in this case, the Oglala Sioux tribe — to take advantage of the group’s tribal immunity. In reality, the lawsuit argues, the lender pays the tribe only a small percentage of its earnings in exchange for using its name, while it is funded and operated entirely by non-tribe members.

The lawsuit alleges that the defendants were not in fact a legitimate “arm of the tribe” and instead acted “against the wishes of the tribal authorities.” The lawsuit alleges that when two of the individual defendants approached the Oglala Sioux Tribe’s Economic Development Bureau with a proposal to enter into a high-yield consumer loan deal, the tribe turned it down. Only after this event did the persons WLCC and WLCC II form the Case Relays.

According to the complaint, because Fast Day Loans’ operations on non-Indigenous land, including in Utah, Texas, Canada and Belize, were conducted by non-Indigenous entities and individuals and did not benefit the Oglala Sioux tribe, the lender is not protected from liability under the sovereign immunity of the tribe.

“When non-Indigenous individuals and entities control and administer the material credit functions, provide the credit capital needed to support the operation, and bear the economic risk associated with the operation, they are not in effect ‘operated’ by Native American tribes and, therefore, are not protected by sovereign immunity ‘ argues the complaint.

The lawsuit alleges that Fast Day Loans nevertheless made loans to Indiana residents at more than 700 percent interest and in violation of the state’s usury laws.

The lawsuit seeks to represent anyone with an address in Indiana who was granted a loan on behalf of Fast Day Loans at more than 36 percent interest on or after the date two years prior to the filing of the lawsuit (April 19, 2022), or on or after a date four years before the filing of the lawsuit.

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