In 2013, as part of its crackdown on illegal online payday lending, the New York State Department of Financial Services (DFS) sent letters to 117 banks requesting that they work with DFS to prevent online payday lenders from making usurious payday loans to New York State residents, and then draining New Yorkers’ bank accounts by their abuse of the electronic payments network. Several online payday lenders affiliated with Native American tribes responded by suing DFS in federal court. The lenders claimed that DFS’s actions unlawfully interfered with their tribal sovereignty, and asked the court to order DFS to cease and desist. The court denied the payday lenders’ request, and they appealed.
New Economy Project, along with eight other advocacy organizations, filed an amicus brief in support of DFS, detailing the harm that usurious payday loans cause New Yorkers and their communities.