The person-to-person loan website Prosper.com has been talked about in mostly positive ways since it launched a few years ago. Mark Gimein at Slate’s The Big Money says it’s a lot less awesome than you’ve been led to believe. In fact, he says it’s just a microcosm of what happened in the real financial world: “Loans to unqualified borrowers; reliance on mathematical models that turn out to be a lot less useful than they seemed; failed hopes that high interest rates could make subprime loans profitable; sky high default rates [of 39%]—Prosper has it all.”
“We’re not the mean waterboarding company that people think we are,” says the general counsel for Prosper Inc., a company that sells “coaching packages” over the telephone. They’re being sued by a former employee who says he was held down as his boss emptied a gallon jug of water into his mouth and nose as part of a team-building exercise. Our tipster Rachael writes that it’s like “an episode of The Office gone horribly wrong.”
Motivational coaching company Prosper is the subject of an unusual lawsuit: “A supervisor…is accused of waterboarding an employee in front of his sales team to demonstrate that they should work as hard on sales as the employee had worked to breathe.” C’mon team, let’s Gitmo sales! [Salt Lake Tribuine]
Person-to-person lending site Prosper.com lets you take and make loans to other average citizens. Prospective borrowers register and let Propser review their credit history. They can request from $1,000 to $25,000 in an unsecured loan and specify an upper limit of interest they’re willing to pay. Then, other users check out the borrower’s profile and decide whether to fund them. You can bid as little as $50 on other people and fund multiple borrowers, spreading out the risk. Depending on the type of loan, you can earn upwards of 9% interest on your investment. The loans are for three years and there’s no prepayment penalty.