Green Arrow Solutions Facing ‘Rent-a-Tribe’ Class Action Over Payday Loan Interest Rates

New to ClassAction.org? Read our Newswire Disclaimer

A proposed class action alleges payday lender Green Arrow Solutions has attempted to evade Illinois usury laws by posing as a Native American-owned entity that claims to be shielded by sovereign immunity. 

Want to stay in the loop on class actions that matter to you? Sign up for ClassAction.org’s free weekly newsletter here.

The 20-page case claims that although Green Arrow purports to be owned and operated by the California-based Big Valley Band of Pomo Indians, virtually all business functions are performed far from tribal land by non-tribal companies Integra Financial Services and Nevada Impact Management and their non-tribal managers, Dan Shaw and Greg Jones.

Known as a “rent-a-tribe” scheme, this arrangement typically involves a payday lender who attempts to hide behind tribal sovereign immunity to circumvent state interest rate caps and charge consumers excessive interest rates on small loans, the lawsuit says.

The plaintiff, an Illinois consumer, says he obtained from Green Arrow throughout 2022 two loans with annual interest rates of 844.98 and 804.09 percent. The suit relays that Green Arrow, as an unlicensed, non-bank entity, was prohibited under Illinois law from issuing loans at more than nine percent interest. Moreover, loans made by an unlicensed lender at more than 20 percent interest are considered a felony under Illinois’ criminal usury statute, the case says.

As the complaint tells it, several signs indicate that Green Arrow is not managed by a Native American tribe, the first being that the “hours of operation” listed on its website show that the company operates in the Mountain Time Zone, even though the tribe is located in the Pacific Time Zone. The complaint alleges that Green Arrow instead runs all its business operations from where Integra is headquartered in North Logan, Utah, almost entirely “for the benefit of persons who are not members of the Tribe.”

“In exchange for use of the tribe’s name, the beneficial owner of the payday lending scheme pays the cooperating tribe a fraction of the revenues generated,” the filing states, adding that several other internet lenders claim to be owned by the Big Valley Band of Pomo Indians, including Big Valley Financial, Golden Gate Funding, Tremont Lending, Little Lake Lending and Condor Credit. “While the percentage varies from scheme-to-scheme, the number is almost always in the single digits.”

The lawsuit further notes that Shaw and Jones formed Integra in July 2011 to acquire the assets of Impact Payment Systems, LLC, an internet lender the U.S. Securities and Exchange Commission had sued and called a Ponzi scheme in March of that year. Per the case, Shaw, Jones, Integra and Impact created Green Arrow Solutions in 2014 to continue conducting a high-interest online loan business.

Moreover, the filing argues that Green Arrow does not offer loans to customers in states where it’s more likely to face public or private enforcement actions.

The lawsuit seeks to cover anyone in Illinois to whom a loan was made in the name of Green Arrow Solutions or Green Arrow Loans at more than nine percent interest which has not been paid in full.

Get class action lawsuit news sent to your inbox – sign up for ClassAction.org’s free weekly newsletter here.