HARRISBURG, PA — Attorney General Michelle Henry has announced a significant settlement with SoLo Funds, Inc., a California-based lending platform accused of deceptive loan practices. The agreement addresses issues surrounding the company’s tip and donation features, which allegedly misled borrowers into paying inflated interest rates under the guise of interest-free loans.
SoLo Funds markets itself as a community finance platform, offering short-term loans with repayment terms of 35 days or less, where borrowers can “tip” lenders and donate to the platform’s maintenance. However, the Pennsylvania Office of Attorney General charged that these practices violated state lending laws by disguising high interest rates as optional tips and donations.
Under the settlement terms, SoLo Funds will overhaul its business practices in Pennsylvania. This includes stopping any loan offers exceeding the interest rates allowed by state laws, ceasing misleading advertising about loan costs, and halting improper debt collection practices. Additionally, SoLo will make partial restitution to affected consumers and pay civil penalties and costs.
“This settlement will put an end to SoLo’s deceptive practices, ensuring they no longer mislead Pennsylvania consumers or engage in illegal lending activities,” said Attorney General Henry. The agreement marks a proactive step towards protecting consumers and maintaining fair lending standards within the state.