The recent rebuke by the Solicitor General (SG), a unit of the Department of Justice, concluded that Midland Funding LLC (a nonbank collection company) has the right to charge the same level of interest as FIA did in its original Delaware governing agreement. The rebuke overrides New York’s usury laws which are capped at 16%, or 25% if Midland were licensed by the New York Department of Financial Services. Originally, the Court sided that petitioner Midland Funding was not acting on behalf of Bank of America or FIA in its attempt to collect Madden’s debt. Because of this position, Midland should have been subject to New York State’s civil usury laws and not the original governing Delaware law. SG has recommended that the Court turn down the case as it is confident that Midland will win on either Delaware law or under New York’s “valid when made” usury rule.
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