California’s financial regulator and Navitas Credit Corp. reached a $4 million settlement resolving the agency’s findings that the company lent in the state before obtaining a required license, the Department of Financial Protection and Innovation (DFPI) announced in a press release Monday.
The agreement, set out in a consent order, also calls for Navitas to reimburse the department $78,000 in investigative costs and to refund borrowers who the agency says were charged interest above California’s legal limits. Navitas entered the order to resolve the matter; it did not admit the allegations.
The DFPI said the issues arose after Navitas applied for California lending licenses through the Nationwide Multistate Licensing System in May 2023. According to the consent order, the agency’s review of that application led it to conclude that the company had lent without a license — including some loans under $5,000 that California treats as consumer loans — that since March 2018 it had paid compensation to third-party brokers who were unlicensed or otherwise not exempt, and that some borrowers had been charged interest or fees above statutory limits on the smaller loans. Navitas did not contest the findings as part of the settlement.
“The DFPI is dedicated to keeping the lending marketplace fair and open. Our diligent oversight helps to level the playing field for businesses and protects consumers,” said Commissioner Khalil “KC” Mohseni in the issued press release, who added that the department expects institutions to follow its licensing laws “or face stiff penalties.”
Under the agreement, Navitas will identify consumer loans it originated since March 27, 2018, on which borrowers paid interest above California’s statutory usury caps and refund the difference. The company will notify affected borrowers by mail and email, mail refund checks within 70 days of the order’s effective date, and report to the department on its compliance within 90 days. In turn, the commissioner agreed to resolve the claims and to process Navitas’s pending license application once any remaining requirements were met — a process the company says is now complete.
Navitas provided the following statement in full:
Navitas is fully operational in California and has a California Financing Law license (60DBO-183060). We continue to remain focused on serving our partners and customers throughout the state. Our safe and sound business operations, service capabilities, culture of compliance, and commitment to the marketplace remain unchanged. We remain steadfast in our belief that our products are some of the best in the marketplace, competitively and fairly priced to meet the commercial needs of all of our customers.
Navitas is a strong, stable organization with a solid financial foundation, committed to supporting the needs of our customers, brokers, vendors, and strategic partners. We will continue to provide equipment financing with the high level of service and integrity our partners and customers expect.
We appreciate the continued confidence placed in Navitas and are steadfast in our commitment to strengthening our position as a trusted leader and partner of choice in the equipment finance industry.
