Lawsuit goes after Texas backers of tribal lending operation including Fort Worth group

HELENA, Mont. (AP) — Two Vermont women suing over the online lending practices of a company owned by a Montana Native American tribe are now going after the company’s Texas backers.

Jessica Gingras and Angela Given filed new claims in U.S District Court in Vermont Tuesday saying that Fort Worth-based Think Finance Inc. and its subsidiaries conspired with the Chippewa Cree Tribe’s Plain Green LLC in a racketeering scheme designed to defraud poor people.

The women’s lawsuit says Think Finance Inc. and its former president, Kenneth Rees, approached Chippewa Cree leaders in 2011 with a payday lending scheme that used the tribe’s immunity from lawsuits to circumvent state laws that cap or regulate interest rates.

The Chippewa Cree have sovereign immunity, a doctrine that grants tribes the power of self-government and exempts them from state laws that infringe on that sovereignty. It also gives them immunity in many judicial proceedings.

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Think Finance and its affiliated companies provided the customers, the technology and the access to money, while the tribe was only required to operate a small call center and change its laws to allow short-term lending, the lawsuit said, citing a sheet outlining terms between Think Finance and the tribe.

Think Finance and Rees tried to avoid liability by “falsely claiming that they only provided services to Plain Green, when in reality they created the whole enterprise and ran its operation through an assortment of subsidiaries and affiliates,” the lawsuit read.

The tribe released a statement through its spokeswoman, Shelby DeMars, that said Plain Green’s executive team retains full control over all aspects of the business. “This is a transparently desperate attempt to inject new life into a baseless lawsuit full of allegations that are not only false but are also disparaging to all members of the Chippewa Cree Tribe,” the statement said.

Ninety-nine percent of the loans made by Plain Green were immediately sold to a Think Finance-affiliated company in the Cayman Islands, and the tribe received just 4½ percent of the revenue from those loans, according to the term sheet.

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Think Finance and Rees, who now leads a spin-off company of Think Finance called Elevate, both declined to comment on the lawsuit, which only tells one side of a legal dispute.

Gingras and Given are asking U.S. District Judge J. Garvan Murtha to certify a class-action lawsuit for thousands of people who borrowed money from Plain Green at annualized interest rates of up to 379 percent. The lawsuit says the company exploits and extorts people who need emergency cash and have no other borrowing options.

Besides racketeering, the women say Plain Green is violating multiple federal and state consumer and trade laws. They are asking Murtha to block the company from doing business and return the excessive interest collected from its customers.

Their original lawsuit, filed in May, named three leaders of Plain Green as defendants. The three men have asked the judge to dismiss the lawsuit, saying they are protected by sovereign immunity and that the dispute should be decided by arbitration.

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The new lawsuit adds Rees, Think Finance and its affiliated companies, along with two venture capital firms the women claim provided funds for the lending operation.