Clearbanc Engages in Unlicensed Loan Activity, Lawsuit Alleges

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A proposed class action claims that Clear Finance Technology Corporation—which does business as Clearbank—offers illegal loans to individuals and small businesses who have had difficulty obtaining bank financing.

The case, which has been removed from state to federal court in California, alleges that the defendant “preys” on vulnerable consumers and businesses by issuing loans with “deceptively” high interest rates that exceed the legal limit for unlicensed brokers. Additionally, the suit charges that the defendant attempts to evade California lending laws by disguising its loans as investments. The complaint argues that these transactions are, indeed, loans, in part because potential recipients’ creditworthiness is supposedly examined prior to the exchange.

According to the case, the defendant has provided unlawful cash advances to tens of thousands of consumers, including Uber drivers and users of Airbnb, Homeaway, Shopify, Harbortouch and Facebook.