A lender is found to have willfully and knowingly put a prohibited term in a covered loan. The borrower's actual loss is $2,600. What statutory damages measure and fee recovery apply to a willful and knowing violation?
Correct Answer
D) She recovers $15,000 or actual damages, whichever is greater, plus fees
A failure to comply makes the person civilly liable for actual damages plus attorney fees and costs, and where the violation was willful and knowing the figure is $15,000 or actual damages, whichever is greater, plus fees. Other choices: compensatory damages alone is the rule for a violation that was not willful; the statutory sum is a floor rather than a substitute; and trebling is a usury remedy, not this one. Source: Cal. Fin. Code § 4979.8
Why This Is the Correct Answer
A failure to comply makes the person civilly liable for actual damages plus attorney fees and costs, and where the violation was willful and knowing the figure is $15,000 or actual damages, whichever is greater, plus fees. Other choices: compensatory damages alone is the rule for a violation that was not willful; the statutory sum is a floor rather than a substitute; and trebling is a usury remedy, not this one. Source: Cal. Fin. Code § 4979.8
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