Western Sky Financial

[CafeChamelion]

This is going to be a little long, but is relevant to consumer lending protection.

I was watching tv tonight and saw an ad for Western Sky financial, which is advertised as a Native American lending originator. I went online to find the website for them and couldn't believe what I saw. UNREAL interest rates. The payment schedule they have there establishes on a 10k loan, the total repayment is over 60k. 40k repayment on a 5k loan.

So I did some more digging to find more about it and expecting it to be a huge scam. I discovered some information that the company has several different names, several lawsuits against them, several AG complaints, and is working an apparent scam through the courts as well. When people borrow and default, which is quite frequent, they run it into tribal court and get a judgement on it, then try wage garnishments on those who defaulted. I also saw reports of people being sued for personal damages as well.

My questions..

Are these tribal court judgements enforceable on those who are not tribal members and do not reside on the reservation?

Is the company in question subject to FDCPA, FCRA, and TCPA laws even though they are located on a reservation?

Thanks and I look forward to any and all responses.

[racecar]

State courts have held that tribes operating as business

entities off-reservation are subject to their jurisdiction, and the

court has the power to resolve the dispute.

National Indian Law Library, Native American Rights Fund (NARF)

Chambliss, Bahner & Stophel, P.C.

On February 15, 2011, after investigating several complaints about the plaintiff companies, the OCFR issued a summary cease and desist order (“the order”) to the three companies and Martin Webb. ECF No. 1 Ex. 1. The order states that, after investigating the plaintiffs' business activities in Maryland, the OCFR concluded that the plaintiffs had engaged in “usurious and unlicensed lending to Maryland customers in violation of Maryland law.” Id. Ex. 1 at 2–3. In addition to requiring them to stop lending to Maryland residents, the order demanded that the plaintiffs provide the OCFR with records of all their loans to Maryland residents. Id. Ex. 1 at 24–26. The order cited the laws and regulations that the OCFR had found the plaintiffs had violated, and included the OCFR's findings of fact, and notice that the plaintiffs were entitled to a hearing to contest the findings.FN3 Id. Ex. 1 at 27.

FN3. The order noted that if the plaintiffs did not request a hearing, the OCFR could finalize the order, impose a “civil penalty up to $1,000 for a first violation and up to $5,000 for each subsequent violation,” and “enter a final order declaring ... that all consumer loan agreements entered into by the Respondents with Maryland consumers are illegal and unenforceable.” ECF No. 9 Ex. 3 at 27.

Edited December 3, 2012 by racecar

[CafeChamelion]

Thanks for the reply RaceCar...

After checking that first link, it looks like the law here is kind of dicey at best...On one hand, the owner is claiming sovereignty because of his tribal membership, but on the other hand is acting as owner of limited liability corporations....Also of interest is the case law asserting that applying for and agreeing to an agreement over the internet sets the jurisdiction to the entity receiving such communication....Seems to me that they would be ok if they would obtain licensing to originate loans in the state of Maryland?

I'd still like to see how TCPA, FCRA, and FDCPA would be treated in this situation....I can see where this type of lending is going to be doing some serious damage to consumers if it continues, especially if the consumer protection laws don't apply or are not enforceable on these companies...

[Seadragon]

But also because the federal statutes apply to non native americans and these intricacies of law typically fail. Because tribal law is not binding off the reservation the courts for domestication of judgment would have to be based on the court layout. Now I think these places get around that with an arbitration agreement.

It is dicey at best. It would be best to stay away from that. Better to go to some guy in Bruno Magliano's than this, but watch your legs.

Just sayin

[racecar]

TCPA, FCRA, and FDCPA would apply to off-reservation entities.

Buffalo, New York Auto Fraud, Payday Loan, Title Loan, TCPA, Deceptive Business Practices, Consumer Fraud, Warranty, False Advertising, Ripoffs, RICO Act, Class Action Lawyer

Payday and Title Lenders try various schemes to avoid federal laws and New York's laws against usury. These include fake arbitration procedures, or locating themselves on an Indian reservation or in a foreign country where you cannot sue them. However, they are not going to sue you in a New York court to try and collect the money because New York courts will not enforce such an illegal loan. If a debt collector or attorney contacts you to collect the loan, and particularly if they threaten to sue you, you can sue them for violating the Fair Debt Collection Practices Act. If the lender repossesses your car to collect a title loan, you can sue the repossession company and any others involved. If you are having trouble with Payday or Title Loans, contact us to discuss your options.

[Coltfan1972]

Well last year I was going to take one for the team and do a test case and get a loan and quickly default on it and tell them to come after me. Arkansas is only one of two states that ban these type of loans. I figured if they had their own "special tribal court" or whatever they would think they could get to me that way.

Well no dice. I applied for 10K all the way down to the min they would loan and the second it got to my state was Arkansas, it was quickly denied. On-line, over the phone, call me back request and they wanted no part of me.

Again, I was willing to take one for the team like the good member I am (oh and I guess the 10K would have been nice) but that pretty Native American they have on their commercials did not want to do business with Coltfan.

And yes, I would have no problem sleeping at night if they would have loaned me the money. This type of scum prey on the most desperate of society. There is nobody that is going to be able to pay back the money at that type of interest and they know it.

Yes, nobody holds a gun to your head, but that assumption of risk works both ways.

[gwheelock915]

I heard if you default on their loan, they come to your house on horseback and scalp you.

[BTO429]

You takem heap big loan, we takem your house

[antiquedave]

You takem heap big loan, we takem your house

Big losers at the local casino have lost homes and businesses, many divorces, suicides, robberies, bankruptcies,

[CafeChamelion]

Coltfan, that was the same idea I was thinking for you....Maybe you could get a PO box in another state and then change it back to Arkansas once it goes through...I think there would be some significant sparks flying if you could get them to do business with you

[racecar]

WESTERN SKY FINANCIAL is owned wholly by an individual Tribal Member of the Cheyenne River Sioux Tribe and is not owned or operated by the Cheyenne River Sioux Tribe or any of its political subdivisions. WESTERN SKY FINANCIAL is a Native American business operating within the exterior boundaries of the Cheyenne River Sioux Reservation, a sovereign nation located within the United States of America. Western Sky loans are not available to consumers in California, Colorado, Maryland, South Dakota and West Virginia.

We are an installment lender and our rates are much lower than most payday lenders.You may apply now online or call 1-866-759-1224 to speak to a loan agent.You tell them racecar sent ya,will leave the light on for you.

https://www.westernsky.com/LoanApp/Application.aspx

"Better make it six, I can't eat eight." - Coltfan1972, CIC poster, when a waitress asked whether he wanted his pizza cut into six or eight slices.

Edited December 3, 2012 by racecar

[BTO429]

Western Sky Financial operates within the boundaries of the Cheyenne River Sioux Reservation, which is a sovereign nation within the United States. It is owned by an individual within that nation and not the Cheyenne River Sioux Reservation itself.

In the case of Western Sky, the lowest available APR is 116.73% and can be as high as 215.03%. This means that if you borrow $5,000 from Western Sky at 116.73% APR and take the full 84 months to pay it back, you will have paid $35,872.72 in interest.

It is really hard for states to apply laws to a sovereign nation within its borders.

[WhoCares1000]

I think a few states such as Maryland have been able to pierce the tribal boundary to enforce their laws along with the FTC (The Federal Government can enforce its laws on an Indian Reservation). A contract is only as good as a judge says it is so any exclusion on your rights to use the local courts/process can be thrown out.

I also think the FTC has an injunction out against them to stop most of the abuses.