Makwa Finance Lawsuit: Settlement, Class Action, and Consent Order

The Makwa Finance lawsuit most borrowers are asking about is Fitzgerald v. Wildcat, a federal class action in Virginia that ended in a 2024 settlement canceling roughly $1.4 billion in outstanding loans across Makwa and the other lending brands owned by LDF Holdings, and creating a $37.35 million cash fund for about 980,000 borrowers. Makwa also faces a separate class action in Illinois and a 2024 consent order in Minnesota, all built on the same core claim: that the loans, which have carried annual rates above 600%, violate state usury and licensing laws and that Makwa’s tribal affiliation was used to shield non-tribal operators from those laws.

What the Lawsuits Say About Makwa’s Loans

Makwa, LLC, doing business as Makwa Finance, is chartered under the laws of the Lac du Flambeau Band of Lake Superior Chippewa Indians and is one of at least twelve lending brands controlled by LDF Holdings LLC, a tribally owned corporation.¹² Court filings in the broader litigation identified about twenty LDF lending companies in total, some of which have since ceased operations.³

The rates are what drive the litigation. In the Illinois class action, the named plaintiff borrowed $825 from Makwa in March 2020 at a disclosed APR of 686.79%, structured to repay $3,388.80 over six months, including $2,563.80 in interest.¹ Better Business Bureau complaints have reported APRs from 300% to 500% on Makwa loans, along with allegations of unauthorized bank withdrawals and hidden fees.⁴

The plaintiffs’ central legal theory is that these are “rent-a-tribe” arrangements. Court filings and reporting have found that marketing, underwriting, compliance, accounting, collections, and website management were handled by non-tribal partners, and that the president of LDF Holdings, Jessi Lee Phillips Lorenzo, is not a member of the tribe.⁵⁶ The Fitzgerald complaint alleged that under some servicing contracts the tribe received as little as $3.25 per originated loan while outside partners collected the bulk of revenue. Skytrail Servicing Group, one of the largest non-tribal partners, denied those allegations, and the actual financial terms remain largely redacted.⁷⁸

The Fitzgerald Settlement and What Borrowers Receive

Fitzgerald v. Wildcat was filed in 2020 in the Western District of Virginia and named the LDF lending network, tribal officials, and non-tribal partners, alleging RICO and state lending law violations across multiple states. In August 2023, the court denied the defendants’ motions to compel arbitration and to dismiss, finding that the loan agreements’ arbitration clauses were unenforceable because they required disputes to be governed exclusively by tribal law, which effectively waived borrowers’ rights under state usury and licensing statutes.⁹

Preliminary approval came in August 2024. Final approval was entered on December 17, 2024, and the settlement took effect on January 16, 2025.³ The terms:

About $1.4 billion in outstanding loans issued between July 24, 2016, and October 1, 2023, was canceled for borrowers of any of the twenty LDF lending brands, including Makwa Finance.
A $37.35 million cash fund was set up to pay eligible class members automatically, with amounts calculated by state law and by how much each borrower had already repaid.
Roughly 980,000 borrowers were eligible.¹⁰

Of the cash portion, tribal defendants were responsible for $2 million. Non-tribal partners paid the rest, including $6.5 million from Skytrail Servicing Group and its owner William Cheney Pruett, and $20 million tied to the “Loan at Last” subsidiary.⁵ All defendants denied wrongdoing.³

The first round of payments went out in March 2025. A second distribution, going to borrowers who successfully received the first payment, is scheduled for June 2026.³ The settlement did not shut down the lending operations; LDF was allowed to continue lending going forward.⁵

The Illinois Class Action

On May 26, 2023, Illinois resident Joann McLaughlin filed a separate class action against Makwa, LDF Holdings, Lorenzo, and two debt-collection entities, ZenResolve LLC and Granite Acquisitions LLC, in the U.S. District Court for the Northern District of Illinois.¹

The complaint alleged that Makwa is not licensed by the Illinois Department of Financial and Professional Regulation to make consumer loans at rates above 9%, making its loans to Illinois residents “usurious and illegal” under the Illinois Interest Act.¹ It brought four counts: a declaratory judgment asking the court to void the loans and enjoin collection; violations of the Illinois Interest Act; RICO treble damages against Lorenzo for allegedly collecting unlawful debts through racketeering activity; and Fair Debt Collection Practices Act violations against ZenResolve and Granite Acquisitions for trying to collect on debts the suit says are legally void.

ZenResolve, based in Lakeport, California, had itself claimed tribal affiliation with the Big Valley Band of Pomo Indians and had been named in other suits for collecting on high-interest tribal loans. In 2020 it filed papers saying it had merged into Granite Acquisitions, but continued operating under the ZenResolve name afterward.¹

The Minnesota Consent Order

In November 2024, Minnesota Attorney General Keith Ellison announced a consent order against LDF Holdings and all twelve of its lending subsidiaries, including Makwa Finance. The order required the companies to stop lending to Minnesota residents and to cancel all outstanding loan balances held by Minnesota borrowers, which the attorney general’s office estimated at more than $1 million.²

Ellison’s office alleged the lenders had charged Minnesota borrowers interest rates between 200% and 800%, far above the state’s 36% cap on small, short-term consumer loans. The order rejected the argument that tribal ownership exempted the companies from state law and required compliance with Minnesota’s lending rules for any future activity in the state.¹¹

Why Tribal Sovereign Immunity Didn’t Stop These Cases

A recurring defense throughout the LDF litigation has been tribal sovereign immunity. The tribe and its lending entities have argued that as arms of a sovereign nation, they are not subject to state usury laws.

In June 2023, the U.S. Supreme Court weakened that defense in the bankruptcy context. In Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin, the Court ruled 8-1 that the federal Bankruptcy Code strips sovereign immunity from all governments, including federally recognized tribes.¹² The case involved Lendgreen, another LDF subsidiary, which had continued trying to collect from a Massachusetts borrower after he filed for Chapter 13. The ruling means tribal lending entities are subject to the automatic stay, must file proofs of claim like other creditors, and can be sued by bankruptcy trustees seeking to recover recent payments.¹³ The tribe later agreed to pay Coughlin a $340,000 settlement in September 2024.⁷

The Coughlin ruling applies to bankruptcy proceedings. The Fitzgerald court’s separate ruling on arbitration clauses, and Minnesota’s rejection of the tribal-ownership argument, addressed sovereign immunity in the consumer lending context and allowed those actions to proceed on their own footing.

What Makwa and the Tribe Say

Lac du Flambeau leaders have described the lending business as legitimate economic development. Tribal President John Johnson Sr. has said lending profits go to the tribe’s general fund and support police, healthcare, and education on a rural reservation where the median household income is under $52,000.⁸ LDF Holdings employed roughly 50 people on the reservation in 2022 and about 170 as of 2026, with 70% tribally enrolled.⁵ All defendants in Fitzgerald denied wrongdoing as part of the settlement.³ Makwa’s own rate disclosure page lists no specific interest rates, saying only that terms are “fully disclosed to you in your loan agreement upon approval.”¹⁴

If you took out a Makwa loan between July 24, 2016, and October 1, 2023, the Fitzgerald settlement is where your loan status and any cash payment are being handled; the settlement administrator’s site is the place to check payment timing for the June 2026 second distribution.³

1
ClassAction.org. McLaughlin v. Makwa LLC et al.
2
Minnesota Attorney General. LDF Holdings Consent Order Announcement
3
Consumer Loan Settlement. Fitzgerald v. Wildcat Settlement
4
BBB. Makwa Finance Complaints
5
ProPublica. Wisconsin Lac du Flambeau Tribe Predatory Lending Lawsuit Sovereign Immunity
6
WPR. Fitzgerald v. Wildcat Court Filing
7
Wisconsin Watch. Wisconsin Lac du Flambeau Tribe Lending Loan
8
Tribal Business News. A Wisconsin Tribe Built a Lending Empire Charging 600 Annual Rates to Borrowers
9
Justia. Fitzgerald et al v. Wildcat et al
10
APG-WI / Sawyer County Record. Judge Approves Historic Payday Loan Settlement Involving Lac du Flambeau Tribe
11
Fox 9. Minnesota AG Cracks Down on Predatory Lenders Charging Triple Digit Interest Rates
12
Supreme Court of the United States. Lac du Flambeau Band v. Coughlin
13
Oklahoma Bar Journal. Examining the Implications
14
Makwa Finance. Rates