Attorney General Keith Ellison has asked a federal court to shut down the Minnesota lending operations of companies owned by a Montana Indian tribe.
The three payday lenders have made thousands of online loans to Minnesota consumers carrying interest rates between 474% and 795%, allegedly violating several state and federal laws, Ellison's office said in a suit filed Monday in U.S. District Court in Minneapolis.
"These businesses have been engaging in the worst kind of predatory lending and I'm glad to bring this lawsuit to stop the harm they are causing and help people afford their lives," Ellison said in a news release.
Ellison said the lenders are breaking Minnesota laws including for usury, consumer fraud and deceptive trade.
The lending companies are operated by Island Mountain Development Group, a company in Hays, Mont., owned by the Fort Belknap Indian Community. Defendants named in Ellison's suit are Evan Azure and Geno LeValdo, respectively CEO and chairman of Island Mountain.
The defendants shield themselves from responsibility for their allegedly illegal loans by citing the sovereignty of the Fort Belknap community, a federally recognized tribe, according to the suit.
The sovereign status of the lenders' ultimate owner prevents a suit directly against a tribal entity, Ellison said.
A representative for Island Mountain and the defendants declined to comment.