BlockFi to provide over $100K in refunds to California clients

cointelegraph.com:

Bankrupt crypto lender BlockFi has agreed to refund more than $100,000 to California customers that had continued to repay loans even after a trading halt on Nov. 10 last year. 

According to a March 27 statement from California's financial watchdog, the Department of Financial Protection and Innovation (DFPI), its investigation discovered at least 111 borrowers in California paid back roughly $103,471 in loan repayments between Nov. 11 and Nov. 22.

The regulator claimed that BlockFi failed to "provide timely notification to borrowers that they could stop repaying their BlockFi loans."

Californian @BlockFi users: BlockFi to refund over $100k after failing to notify borrowers about halting repayments post-FTX crash. The motion was filed, with a hearing set for April 19, 2023. Updates to follow. More info: https://t.co/bJkiyfgA1b #FTX #BlockFi #CryptoRefund pic.twitter.com/u0QpwY6oou

The DFPI claims that borrowers were not notified until Nov. 22 that they could stop repaying their BlockFi Loans "until further notice."

According to documents, BlockFi requested permission from the bankruptcy court to return these payments to the borrowers in a motion filed with the court on Feb. 24, 2023.

The refunds will be able to go ahead if the motion is approved, with a hearing scheduled for April 19.

Meanwhile, the DFPI said BlockFi has agreed to an "interim suspension" of its California Financing Law (CFL) license while "the bankruptcy and revocation actions are pending."

"If this motion is granted BlockFi agrees to direct the Servicer to timely return borrowers' payments, including interest and late fees and all funds paid following the November 10th platform pause," according to the DFPI documents. 

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