News Summary
Baltimore has filed a lawsuit against MoneyLion Technologies, accusing the company of engaging in predatory lending practices that harm local residents. The suit, led by Mayor Scott and the City Council, claims that MoneyLion’s ‘zero-interest’ loans mislead borrowers into incurring excessive fees, resulting in APRs exceeding legal limits. The city seeks to protect vulnerable residents from deceptive lending amid growing concerns over financial instability linked to such practices. This action follows MoneyLion’s history of similar legal challenges, aiming to hold the company accountable.
Baltimore has filed a lawsuit against MoneyLion Technologies Inc., alleging that the company is engaging in predatory lending practices that negatively impact local residents. The city, represented by the Department of Law alongside the law firm Berger Montague, formally announced the lawsuit on October 1, 2025. This action was spearheaded by Mayor Brandon M. Scott and the Baltimore City Council. It aims to highlight the financial distress caused by MoneyLion’s alleged misuse of lending products marketed to vulnerable residents.
The lawsuit accuses MoneyLion of operating a “digital-age payday lending scheme,” which allegedly violates Baltimore’s Consumer Protection Ordinance. Central to the case is MoneyLion’s product known as “Instacash Advances,” advertised as “zero-interest” loans. However, the city claims that borrowers are misled into paying various fees and optional “tips,” leading to annual percentage rates (APRs) that exceed Maryland’s legal limit of 33% by more than tenfold.
Mayor Scott expressed concern that MoneyLion’s lending practices have ensnared financially precarious residents in perpetual debt cycles. The lawsuit argues that these misleading tactics hinder vulnerable residents’ ability to pay essential bills and secure basic necessities such as food.
City Solicitor Ebony M. Thompson emphasized the importance of such lawsuits in providing consumer protection, particularly as the federal government has not adequately fulfilled its responsibilities in this area. The city aims to hold MoneyLion accountable and seeks to eliminate deceptive lending practices that have detrimental effects on the community.
Further, the lawsuit highlights how clients of MoneyLion often suffer additional financial consequences, such as incurring overdraft fees. It reports that many borrowers find themselves needing to take out multiple advances to manage their ongoing expenses. The allegations include claims of misrepresentation regarding fees and the pressure placed on users to pay these optional tips, which contribute to excessive interest charges.
According to research from the Center for Responsible Lending included in the lawsuit, many consumers who engage with MoneyLion’s products end up trapped in a cycle of recurring debt, which exacerbates their financial instability. Baltimore officials note that the lawsuit is a direct response to distressing trends observed in the accumulation of debt among users of MoneyLion’s services.
This legal action against MoneyLion is not unprecedented. The company has previously faced similar investigations and lawsuits, including one from New York Attorney General Letitia James concerning comparable violations. Baltimore’s lawsuit aims not only to seek justice for affected residents but also to serve as a deterrent against future predatory lending practices.
In summary, the lawsuit represents a strategic move by Baltimore’s leadership to confront and rectify what they describe as harmful lending practices perpetuated by MoneyLion. By taking legal action, the city hopes to reclaim the financial health of its residents and uphold necessary consumer protections within the realm of digital lending.
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Baltimore Files Lawsuit Against MoneyLion for Predatory Practices
Additional Resources
- CBS News
- Wikipedia
- Banking Dive
- Google Search: MoneyLion Payday Loan Practices
- Fox Baltimore
- Google Scholar: MoneyLion Lawsuit
- Forbes
- Encyclopedia Britannica: Predatory Lending
- Black Enterprise
- Google News: Baltimore MoneyLion Lawsuit
Author: STAFF HERE BALTIMORE WRITER
The BALTIMORE STAFF WRITER represents the experienced team at HEREBaltimore.com, your go-to source for actionable local news and information in Baltimore, Baltimore County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Baltimore Book Festival, Preakness Stakes, and Artscape. Our coverage extends to key organizations like the Baltimore Chamber of Commerce and Visit Baltimore, plus leading businesses in shipping and healthcare that power the local economy such as the Port of Baltimore and Johns Hopkins Medicine. As part of the broader HERE network, we provide comprehensive, credible insights into Maryland's dynamic landscape.
