If you’ve caught any daytime or late-night TV in the last few years, you’ve probably noticed talk show host Montel Williams shilling for a service called MoneyMutual that connects needy borrowers with Payday lenders. Newly released documents show that the company’s lead-generation process is under investigation by the federal Consumer Financial Protection Bureau.
The document, first spotted by Reuters, reveals that the CFPB is investigating lead-generating companies like MoneyMutual to determine if they “have engaged or are engaging in unlawful acts or practices in connection with the marketing, selling or collection of payday loans.”
The Bureau has asked MoneyMutual and its parent company for a large amount of information, including the names of all of MoneyMutual’s “parents, subsidiaries, unincorporated divisions, joint ventures, and affiliates.” It also asks the company to “identify all persons from whom the Company has purchased Leads on behalf of Internet Lenders.”
The specifics and full scope of the CFPB investigation aren’t clear, but some payday lenders have been accused of using the Internet and lead-generation services to connect potential borrowers with lenders, even if payday loans are illegal in the borrower’s state. Additionally, some members of the armed forces — to whom traditional payday loans can not be made — have been able to get around the laws with the involvement of third parties.