FinWise Bank is facing a double crisis—one of data security and another of public trust. Nearly 700,000 customers of American First Finance (AFF), a FinWise partner, were impacted by a massive data breach after a former employee improperly accessed sensitive records. The bank has responded with offers of free credit monitoring, but the damage to consumer trust is already done.
At the same time, FinWise Bank is the subject of intense scrutiny from the National Consumer Law Center and other leading advocacy groups, who accuse the institution of serving as a “rent-a-bank” for predatory lenders. These groups point to FinWise’s partnerships with American First Finance, Elevate Credit’s Rise brand, and OppFi—companies notorious for offering loans with annual percentage rates (APRs) soaring as high as 160%. The allegations are damning: deceptive sales practices, unaffordable repayment structures, identity theft, harassment in debt collection, and inaccurate credit reporting.
Consumer complaints paint a disturbing picture—borrowers paying nearly four times their original loan principal, victims of fraudulent accounts opened in their names, military families charged unlawful APRs, and debt collectors harassing consumers with threats and repeated calls. Under federal guidance, banks are responsible for the risks of their third-party partnerships, and advocates are urging regulators to downgrade FinWise’s Community Reinvestment Act (CRA) rating to reflect the harm inflicted on vulnerable communities.
This episode unpacks the data breach, the allegations of systemic consumer harm, and the wider implications for “rent-a-bank” schemes designed to evade state interest rate laws. Is FinWise Bank enabling predatory lending under the guise of financial innovation, or will regulatory pressure finally rein in these abusive practices?
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