The bureau is looking into whether those firms "have engaged or are
engaging in unlawful acts or practices in connection with the
marketing, selling or collection of payday loans," according to the
document, which was dated February 18 and posted on the bureau's
website on Wednesday.
The document was submitted by MoneyMutual, which connects borrowers
to lenders and is known by many consumers for its television ads
featuring the talk show host Montel Williams, after the CFPB
requested information about the company.
It was not clear whether other firms received a "civil investigative
demand" for documents as part of the CFPB probe.
A spokesman for the consumer bureau declined to comment. A spokesman
for MoneyMutual, which is a subsidiary of digital marketing company
Selling Source, did not immediately have a comment.
Regulators have been keeping a close eye on the payday loan
industry, in which borrowers take out small loans that usually must
be paid back when the consumer receives his or her next paycheck.
Consumer advocates say these high-interest loans can trap primarily
low-income individuals in a cycle of mounting debt. They are
concerned about online lenders in particular, which they say
sometimes skirt state laws for payday loans.
Financial regulators hope to choke off the pipeline of borrowers to
online lenders by going after firms that collect borrowers'
information through their websites and pass it along to potential
[to top of second column]
On its website, MoneyMutual calls itself an "industry leader" in
linking borrowers with small dollar loans and says more than one
million people have used its services.
Benjamin Lawsky, the head of New York's Department of Financial
Services, sent subpoenas last month to MoneyMutual and 15 other
businesses in its industry.
The consumer bureau, which was created by the 2010 Dodd-Frank law
and charged with protecting Americans from dangerous financial
products, took its first enforcement action against a payday lender,
Cash America International, in November.
The bureau also is considering writing new rules for the industry
after it published a 2013 paper that highlighted problems including
consumers' "sustained" reliance on small-dollar loans.
(Reporting by Emily Stephenson; editing
by Alden Bentley)
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