MoneyLion Faces Class Action Over Hidden Loan Interest in California
A June 2026 lawsuit alleges MoneyLion disguised loan interest as fees in California.
Why it matters: Tightening state regulations on consumer loans put legal teams on alert for fee structures that may mask prohibited interest charges. This lawsuit underscores risks of non-compliance with California's AB 539 and potential class action exposure.
- Class action filed June 16, 2026, accuses MoneyLion of hiding loan interest as 'turbo fees,' tips, and membership charges targeting Californians.
- The suit claims these fees violate California's 2019 Fair Access to Credit Act (AB 539), which caps interest rates at 36% plus the federal funds rate for certain loans.
- California Department of Financial Protection and Innovation (DFPI) fined another lender $1 million in October 2025 for exceeding these interest caps, indicating strong regulatory enforcement.
- The lawsuit follows a trend of legal actions aimed at preventing disguised predatory lending practices in California.
On June 16, 2026, a proposed class action lawsuit was filed in California accusing MoneyLion of disguising loan interest as various fees such as “turbo fees,” tips, and membership charges. The complaint asserts that these charges targeted California consumers and effectively circumvented state interest rate limits.
California’s Fair Access to Credit Act (AB 539), enacted in 2019, caps interest rates on loans between $2,500 and $10,000 at 36% plus the federal funds rate. The lawsuit alleges MoneyLion’s fee structures violate these caps by shifting interest charges to fees, which borrowers may not recognize as interest.
The California Department of Financial Protection and Innovation (DFPI) has shown assertive enforcement, exemplified by a $1 million fine in October 2025 against another lender for violating the same interest rate caps. This regulatory vigilance suggests MoneyLion faces significant scrutiny if the courts find fee-based interest masking unlawful.
MoneyLion’s case is part of broader legal efforts in California to combat predatory lending that obscures true loan costs. Consumer finance legal teams and in-house counsel should monitor this case given California’s active regulatory environment and its impact on class action risk.
By the numbers:
- June 16, 2026 — Date MoneyLion lawsuit filed
- 36% plus federal funds rate — Maximum legal interest rate under California's AB 539 for certain loans
- $1 million — DFPI fine levied in October 2025 for violating California interest rate caps
What's next: The MoneyLion lawsuit is pending in California courts; legal observers expect motions over fee legality and regulatory compliance in upcoming months.