Stop the Debt Trap

Time to Reign In Florida Predatory Lenders

High-Cost Predatory Rent-a-Bank Schemes in Florida



Florida APR Source: National Consumer Law Center










Florida law limits interest rates to protect its residents from predatory lending.

Unfortunately, high-cost online lenders are evading Florida law by laundering their loans through rogue, out-of-state banks, which are not subject to state rate caps. In a “rent-a-bank” scheme, a loan program is designed and run by a nonbank lender that charges and collects interest and makes the bulk of the profits.

But a bank’s name is on the paperwork, and the lender claims it is a “bank loan” exempt from state law. Predatory rent-a-bank lending hurts consumers, disabled veterans, and small business owners who can lose their homes to 121% APR loans.

These installment lenders are now using rent-a-bank schemes to evade Florida law1

1. Source:  National Consumer Law Center  https://www.nclc.org/issues/high-cost-small-loans/rent-a-bank-loan-watch-list.html

The legality of rent-a-bank schemes is questionable. But in 2020, the Office of the Comptroller of the Currency approved a “fake lender” rule that prevents courts from following the money to prevent usury law evasions. A second set of OCC and FDIC rules preempting state rate caps on assigned loans also help protect high-cost loans laundered through banks. Both rules have been challenged.   

To preserve Florida’s authority to stop predatory lending, we must:

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