Who Gets the Money? Bank Asks Court To Decide Fate of Millions In CashCall-CFPB Fight
By CU Today Staff —
LOS ANGELES—CashCall’s long-running fight with the CFPB over a $157-million judgment has now pulled Merchants Bank of Indiana into court, with the bank asking a California federal judge to decide what it should do with more than $144 million in collateral tied to the case, Law360 reported.
According to Law360, Merchants filed an interpleader action after receiving competing demands from the CFPB and entities tied to CashCall founder J. Paul Reddam. TCPAWorld similarly reported the deposits are held at Merchants Bank of Indiana through Reddam-related entities, while ReceivablesInfo reported the bank is seeking court direction because of conflicting claims over the money.
The dispute stems from the CFPB’s years-long enforcement case against CashCall, WS Funding, Delbert Services and Reddam. The CFPB’s own case summary says a court found the defendants deceptively collected payments on debts consumers did not owe, while Justia’s summary of the Ninth Circuit ruling says the appeals court affirmed liability and sent the case back for reconsideration of restitution and penalties.
American Banker reported last week that CashCall is asking a California court to overturn the judgment, arguing the CFPB backed away from a proposed settlement for far less than the award. Bloomberg Law also reported CashCall is seeking to vacate the restitution order after the agency allegedly nixed a deal, setting up the new fight over whether the CFPB can collect against the collateral while CashCall continues trying to undo the judgment.
Originally reported by CU Today.