Class Action Claims Evergreen Services, LDF Holdings Operate Illegal ‘Rent-A-Tribe’ Loan Scheme

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A proposed class action lawsuit claims the operators and affiliates of online lenders Evergreen Services and LDF Holdings, LLC are engaged in an illegal “rent-a-tribe” scheme whereby they have issued to Illinois residents loans with unlawful interest rates.

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The 20-page lawsuit says that although those who run EvergreenLoans.com and LDF-Holdings.com claim that the companies are owned and operated by the federally recognized Lac du Flambeau (LDF) Band of Lake Superior Chippewa Indians, the non-tribal lenders merely “[hide] behind” the tribe’s sovereign immunity to “circumvent state interest rate caps.”

The suit also names as defendants LDF Holdings president Jessi Lee Phillips Lorenzo and Opichi, LLC—which does business as Evergreen Services. Per the case, the defendants directly responsible for the lending activities at issue include Rivo Holdings, LLC—a fintech company owned by co-defendants Mark Koetting and Dan Koetting—and Velocity Ventures Group, LLC, which does business as Infinity Enterprise Lending Systems and whose software hosts numerous internet lending websites that claim “tribal” associations. None of the individual defendants are members of the LDF Tribe, the filing notes.

As the complaint tells it, the defendants have issued loans to consumers at annual percentage rates of over 600 percent. These unlawful loans were made in the name of the small, rural Wisconsin-based Native American tribe by whom the online lenders fraudulently claim to be owned in order to evade state and federal laws, the filing charges.

According to the lawsuit, however, the lenders’ sovereign immunity claims are simply an “elaborate charade” to disguise their “otherwise illegal businesses.”

Illinois law states that loans issued by unlicensed entities at greater than nine percent interest are illegal under the state’s Interest Act and therefore void, the suit shares. In fact, per Illinois law, a loan made at over 20 percent interest is considered a felony, the case adds.

The Illinois Department of Financial and Professional Regulation regularly takes legal action against unlicensed out-of-state lenders like EvergreenLoans.com and LDF-Holdings.com to combat unlawful online lending to Illinois citizens, the complaint relays.

The plaintiff, an Illinois resident, took out a $700 loan from EvergreenLoans.com in September 2019 with an annual percentage rate of roughly 633 percent—far in excess of the legal interest rate, the filing says.

The lawsuit looks to represent:

“(a) [All] individuals with Illinois addresses (b) to whom a loan was made in the name of Evergreen Services at more than 9% interest (c) which loan has not been paid in full;”

“(a) [All] individuals with Illinois addresses (b) to whom a loan was made in the name of Evergreen Services at more than 9% interest (c) which loan is still outstanding or has been paid on or after a date two years prior to the filing of suit;” and

“(a) [All] individuals with Illinois addresses (b) to whom a loan was made in the name of Evergreen Services at more than 18% interest (all of its loans qualify) (c) which loan was made on or after a date 4 years prior to the filing of suit.”

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