CFPB Withdraws Lawsuit Against Solo Funds amidst Agency Restructuring
Introduction
The Consumer Financial Protection Bureau (CFPB), a federal agency under scrutiny for potential abolition, has dismissed a lawsuit against online lending platform Solo Funds. The lawsuit, filed less than a year ago, accused Solo Funds of misleading borrowers about loan costs.
Background and Agency Changes
The move comes amid a significant restructuring of the CFPB under the Trump administration. The agency has halted supervision of companies, laid off staff, and removed its insignia from its headquarters. This is reportedly the first lawsuit to be withdrawn since these changes took effect.
Allegations and Dismissal
The CFPB alleged that Solo Funds misrepresented loan costs, coerced "donations," made false threats, and attempted to collect undue funds. Solo Funds denied these claims in court documents.
On Friday, both parties jointly filed a motion to dismiss the case, with each party bearing their own legal expenses.
Independent State Actions
Since 2023, several state attorneys general have also taken action against Solo Funds based on similar allegations.
Lack of Comment
Representatives for the CFPB and Solo Funds have not provided immediate comment.
Conclusion
The dismissal of the lawsuit against Solo Funds indicates a shift in the CFPB's operations under the current administration. The ongoing restructuring and state-level actions suggest a changing landscape in consumer protection.
