Klover class action alleges company charged borrowers 1,000% interest

Klover class action lawsuit overview:

• Who: Plaintiff Mark Cave filed a class action lawsuit against Klover Holdings Inc.
• Why: Cave argues Klover charged borrowers interest rates exceeding the legal limit in Pennsylvania. 
• Where: The class action lawsuit was filed in the Philadelphia County Court of Common Pleas.

Klover Holdings Inc. charged borrowers interest rates exceeding the legal limit in Pennsylvania, a new class action lawsuit alleges. 

Plaintiff Mark Cave claims Klover interest rates can reach 1,000% or more, exceeding the state’s legal limit of 6%, reports Law360. 

Cave argues Klover charged him a $9.99 express fee and $4.99 monthly fee for a $75 cash advance needed to be repaid in seven days — making his annual percentage rate with Klover 1,041.47%. 

“Defendant ensures borrowers pay its express fee by requiring borrowers to pay this charge to use defendant’s cash advance product for its advertised and intended purpose — as an instant source of cash,” the Klover class action says, as reported by Law360.

Cave wants to represent a nationwide class of borrowers who were subjected to fees and “tips” that he argues were actually unlawfully high interest rates for payday loans.

Klover misled borrowers into paying optional tip, class action says

Cave argues the fees charged by Klover are the equivalent of a loan with an annual percentage rate of 500%, 1,000% or more, which he claims makes it difficult for borrowers to pay their bills and “greatly increases” the chance of them overdrafting their bank accounts.

The class action lawsuit further claims Klover misled borrowers into paying an optional tip by making them think doing so was helping individuals in need.

“Unlike an actual ‘tip,’ which goes to a delivery driver, a server or some other hourly worker trying to make ends meet, defendant’s ‘tip’ compensates a large and well-funded corporation for lending money,” the Klover cash advance lawsuit says, as reported by Law360.

The plaintiff demands a jury trial and requests actual, statutory and treble damages with interest; an order providing restitution for interest, fees or other charges that aggregated in excess of 6%; and attorneys’ fees.

Consumers who were charged an unexpected fee when transferring funds using a peer-to-peer payment app may be eligible to join a free class action lawsuit investigation. 

Military members who received a loan or cash advance through an app while either themselves or their spouse was in the military may have been overcharged and could be eligible to receive compensation under the Military Lending Act. 

Have you taken out a loan with Klover in Pennsylvania? Let us know in the comments.

The plaintiff is represented by Kevin Abramowicz, Kevin Tucker, Chandler Steiger and Jessica Liu of East End Trial Group LLC.

The Klover class action lawsuit is Cave v. Klover Holdings Inc., Case No. 250301441, in the Philadelphia County Court of Common Pleas.

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