CashCall, Reddam being sued by Consumer Financial Protection Bureau

CashCall, the online lending business that is a sponsor of the $750,000 CashCall Futurity at Betfair Hollywood Park, and the company’s founder, the horse owner J. Paul Reddam, were named in a lawsuit filed on Monday by the Consumer Financial Protection Bureau alleging that the company violated consumer-protection law, the bureau announced.

The suit alleges that CashCall and two related companies under Reddam’s ownership “engaged in unfair, deceptive, and abusive practices, including illegally debiting consumer checking accounts for loans that were void,” according to the bureau. The suit says the charges relate to consumer loans that violated either licensing requirements or interest-rate caps in at least eight states, and it seeks monetary damages and civil penalties, the bureau said.

Neil Barofsky, the attorney for the companies and Reddam, did not immediately respond to a request for comment, but in a statement released to reporters, he said that “the charges against CashCall are without merit, [and] we will fight them in court.”

Reddam has owned horses for nearly 30 years, and his colt I’ll Have Another won the 2012 Kentucky Derby and Preakness Stakes.

A former professor of philosophy at the California State University in Los Angeles, Reddam entered the loan business with DiTech.com, a mortgage loan company he started in 1995 and sold to General Motors in 1999.