July 19, 2018 / 8:05 PM / 5 months ago

U.S. agency enters $1.5 mln judgment on payday lender but slashes return of funds

WASHINGTON, July 19 (Reuters) - The U.S. consumer finance watchdog ordered an Alabama-based payday lender on Thursday to return $500,000 to borrowers who were overcharged, a fine that people familiar with the matter said was only a third of what the prior Obama-era head of the agency had sought.

The settlement between Triton Management Group Inc and the Consumer Financial Protection Bureau (CFPB) was signed by Mick Mulvaney, who President Donald Trump named in November as the agency’s interim director.

Mulvaney’s predecessor, Richard Cordray, a Democrat who was appointed by President Barack Obama, had said that Triton’s customers were owed about $1.5 million, and he wanted all that money returned to consumers, according to the three sources with direct knowledge of the matter.

The consent order, which the CFPB posted on its website, said the agency entered a judgment of $1.5 million against Triton, but the actual payback to borrowers was reduced to $500,000 because Triton did not have the funds.

The settlement is at least the third time that Mulvaney has dropped or reduced consumer payouts from cases under his review.

Triton Management, which operates about 100 storefront lending offices across the South, routinely overcharged borrowers in Mississippi, the CFPB said on Thursday. (Reporting by Patrick Rucker Editing by Leslie Adler)

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