FTC Sends $9.7M in Fee Refunds to LendingClub Customers

The Federal Trade Commission (FTC) is sending over $9.7 million in payments to 61,990 customers who the FTC said were charged hidden fees from LendingClub, an FTC press release said.

The FTC sued LendingClub in 2018 over the allegations that the company falsely promised loan applicants that they’d get a specific amount without hidden fees. The company, the FTC charged, had deducted hundreds or even thousands of dollars in hidden up-front fees from the loans.

In addition, the FTC said LendingClub told consumers were approved for loans when they weren’t. That delayed them from seeking loans at other places. LendingClub also allegedly took money from consumers’ accounts without authorization.

In July 2021, the company agreed to a settlement that barred them from making misrepresentations to loan applicants, and the company had to disclose the amount of fees and total funds that borrowers would get.

This is second time funds were disbursed in regards to this issue, after another payment from February this year. Over $17.6 million has been sent out.

Affected consumers can choose to get a PayPal payment and can accept that within 30 days. Those who got a check can accept it within 90 days.

In other news, LendingClub has announced Faiz Ahmad and Kathryn Reimann as two new members to its board, PYMNTS wrote. This comes as Patricia McCord announced her resignation from the company board.

See also: LendingClub Appoints Ex-Optum D2C CEO Ahmad, Former Citi CCO Reimann to Board

“With Patty wrapping up her tenure with the board, I’d like to thank her personally and on behalf of the company for her support as we transformed the business from a loan marketplace to a powerhouse digital bank at scale,” LendingClub CEO Scott Sanborn said. “I’m grateful for her counsel and wish her well on her future endeavors.”

Sanborn said both Ahmad and Reimann have plenty of experience in consumer and financial services, with Ahmad having experience in working on consumer experiences for large brands and Reimann working jobs in compliance risk management and bank regulation.