WASHINGTON, D.C. (July 27, 2015) – Native American businesses and their non-tribal service providers applauded a federal court’s decision in Aleksic and Schaller v. Clarity Services, Inc. (U.S.D.C. N.D. Ill.) which again reaffirms the right of sovereign tribal governments to engage in business transactions outside the borders of Indian reservations.
“This decision is another victory not only for tribal lending enterprises, but for all Native American businesses that contract with outside vendors and service providers,” said Native American Financial Services Association (NAFSA) Executive Director Barry Brandon.
The court dismissed allegations that credit reporting agency Clarity Services, Inc. violated the Fair Credit Reporting Act (FCRA) by providing fraud detection services to seven Native American online lending companies. Clarity’s service “Clear ID Fraud” is designed to indicate potentially fraudulent loan applications, which helps protect consumer data and guards lenders against loan fraud.
Although the plaintiffs contended that Clarity violated FCRA by providing its service to the tribal lenders not licensed by the Illinois Division of Financial Institutions, the court summarily dismissed this idea, calling the attacks on tribally-owned businesses and their vendors a “red herring.”
“Tribal enterprises have long been the target of some misguided state regulators, despite the fact that Tribes operate under both sovereign law and federal law,” said Brandon. “NAFSA applauds the court for recognizing the attempt in this lawsuit to mislead and distract from the real issue – Native American tribes’ right to use e-commerce as a viable economic development engine.”
About NAFSA
The Native American Financial Services Association (NAFSA) formed in 2012 to advocate for Native American sovereign rights and enable tribes to offer responsible online lending products. Through the protection of consumer rights and sovereign immunity, NAFSA provides vital services to tribally operated lenders serving the under-banked with better short term financial services, furthering economic development opportunities in Indian Country.
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