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Payday Lenders Sue Regulators Over Operation Choke Point

The Community Financial Services Association of America, the main payday lending trade group, sued U.S. banking regulators, accusing them of applying “back room pressure” on banks to stop serving the group’s members.

A federal anti-fraud initiative known as Operation Choke Point unfairly targets online and storefront lenders by claiming they pose a reputational risk to the banks serving them, according to the complaint filed yesterday in federal court in Washington.