TAB Bank Downgraded by FDIC for Predatory Partnership
TAB Bank Downgraded by FDIC for Predatory Partnership
Utah bank partners with EasyPay Finance to offer 189% interest rate loans for car repair, pet purchases
A Utah-based bank is facing additional scrutiny from the Federal Deposit Insurance Corporation (FDIC) due to its partnership with a fintech lender that charges interest rates of up to 189% on loans for auto repairs, pet purchases, and vet expenses.
Jason Mikula at Fintech Business Weekly reports that TAB bank has had its Community Reinvestment Act (CRA) status downgraded to “needs improvement” following attention focused on TAB’s partnership with predatory lender EasyPay Finance.
While the bank has previously received “Outstanding” ratings on its assessments in 2015, 2017, and 2019, it was downgraded several rungs to “Needs to Improve” on its assessment published earlier this month.
The CRA assessment doesn’t specifically name the EasyPay case, but it’s quite clear that is the reason for the downgrade.
The assessment states that a discriminatory or other illegal credit practice at a single “strategic partner” led to the downgrade . . .
I’ve written before about TAB Bank and about how a range of consumer groups have called them out for facilitating predatory loans.
It’s encouraging, then, to see that a top regulator is finally taking some serious action.
Will this mean that TAB re-evaluates is partnership with EasyPay?
That’s not yet clear — but TAB certainly risks its reputation and possibly some of its ability to do business if it maintains its status as a partner with a known predatory lender.
MORE CONSUMER NEWS
Biden Administration Taking on Junk Fees