Proposed Settlement Bars Financing Firm From Victim Compensation Funds
The federal Consumer Financial Protection Bureau (CFPB) and the New York attorney general have resolved years-long claims of deceptive practices in connection with cash advances offered to people on their settlement payouts from victim-compensation funds.
Under the settlement, RD Legal Funding and its owner, Roni Dersovitz, are permanently barred from doing business with potential recipients of any governmentally created 9/11 victim compensation funds, including New York’s Zadroga Fund for first responders.
The settlement follows years of legal wrangling involving Dodd-Frank Act provisions and the CFPB’s enforcement powers. The CFPB and the New York attorney general’s office filed an original complaint in 2017, which it amended this past July, alleging that RD Legal Funding made misrepresentations to potential borrowers and engaged in abusive practices.
If entered by the court, the proposed settlement will provide more than $600,000 in debt relief for consumers and bar the defendants from doing business with any potential recipients of governmentally created 9/11 victim-compensation funds.
The settlement will also allow consumers in the case to potentially obtain compensation from the Zadroga victim relief fund.
RD Legal Funding, RD Legal Finance, and RD Legal Funding Partners are non-bank entities headquartered in Cresskill, New Jersey. Together with Roni Dersovitz, they offer to advance funds to consumers who are entitled to receive compensation under a settlement fund or judgment.
Prosecutors allege that the firm misrepresented to consumers when they would receive funds from RD Legal and collected on contracts that were void, or where no payment was due.
RD Legal has neither admitted nor denied any of the allegations in the complaint. Both parties have waived all rights to seek judicial review or otherwise challenge or contest the validity of the settlement order.