Settlement was reached on February 12, 2010, in a class action lawsuit brought by the UW Law School's Consumer Law Clinic against the payday lender Arrowhead Investments LLC.
The case began in the fall of 2008 as a joint class action lawsuit in Dane County Circuit Court, brought by the Consumer Law Clinic and the Wisconsin Department of Justice on behalf of the Wisconsin Department of Financial Institutions. The lawsuit alleged, among other things, that Arrowhead issued internet payday loans to Wisconsin consumers in violation of certain provisions of the Wisconsin Consumer Act and also was unconscionable under Wisconsin common law.
The settlement provides significant injunctive relief to Wisconsin residents as well as a cash payment. Arrowhead will pay $180,000 and forgive loans, costs, and fees owed by customers totaling $432,000. The company agreed not to issue loans to any person residing in Wisconsin for the next five years.
The settlement received final approval by Judge Maryann Sumi.
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