The ZocaLoans lawsuit is a federal class action filed in February 2022 in the Northern District of Illinois, Hussam AlNahhas v. Rosebud Lending LZO, et al., alleging that ZocaLoans issued payday loans at interest rates as high as 736% while using a Native American tribe’s sovereign immunity to sidestep state usury laws. As of mid-2026, the case is still active in the district court, no class has been certified, and no settlement has been announced.
Who Actually Ran ZocaLoans
ZocaLoans presented itself as a lender operating on the lands of the Rosebud Sioux Tribe in South Dakota. That framing was the whole point: tribal sovereign immunity, if it applied, would shield the operation from state interest rate caps and consumer protection laws.
According to the complaint, the reality looked different. The lending operation was run from Florida by 777 Partners, LLC, a private investment firm founded by Joshua Wander and Steven Pasko. 777 Partners and its affiliates provided the loan capital, handled origination, underwriting, marketing, and collections, and even registered the ZocaLoans website. Plaintiffs alleged the firm advanced nearly $100 million to fund ZocaLoans and kept exclusive control over its bank accounts and lending policies, while the Rosebud Sioux Tribe’s economic development arm received only a nominal share of revenue. The complaint described the tribe’s involvement as “merely superficial.”1Amazon Web Services. Morgan v. Rosebud Lending, Complaint This kind of arrangement is commonly called a “rent-a-tribe” scheme.
The Interest Rates at the Center of the Case
The loans were short-term and high-cost. In the Illinois class action, the plaintiff alleged rates above 500%, and in at least one instance above 690%.2Wallace Miller. ZocaLoans Class Action Lawsuit A parallel California complaint gave concrete numbers: plaintiff Katey Huntley received a $1,000 loan in November 2019 at 736.38% APR, with total repayment of $3,604.96. Another plaintiff, Gary Jackson, borrowed $700 in August 2021 at 492.56% APR and owed $2,047.48.3Native American Rights Fund. Huntley v. Rosebud Economic Development Corp., Complaint
Illinois law does not tolerate rates anywhere near that. The Illinois Predatory Loan Prevention Act, enacted in 2021, caps consumer loan interest at 36% and declares any loan above that null and void. The Illinois Interest Act sets an even lower ceiling of 9% for unlicensed lenders and makes rates above 20% by an unlicensed lender a felony.2Wallace Miller. ZocaLoans Class Action Lawsuit
The Illinois Class Action and What It Seeks
The lead case, filed by Hussam AlNahhas and represented by the firm Wallace Miller, names 777 Partners, LLC and Rosebud Lending LZO among the defendants and brings claims on behalf of Illinois borrowers who took loans from ZocaLoans.2Wallace Miller. ZocaLoans Class Action Lawsuit
The suit asks the court to do three things: halt collection on the loans, declare the loans void under Illinois law, and award damages. Because loans above the 36% cap are void under the Predatory Loan Prevention Act, the lender would have no legal right to collect anything, principal included. The Illinois Interest Act separately allows consumers to recover twice the interest they were charged.2Wallace Miller. ZocaLoans Class Action Lawsuit
The Arbitration Fight That Has Slowed the Case
ZocaLoans’ loan agreements contained mandatory arbitration clauses, and much of the litigation so far has turned on whether those clauses can force borrowers out of court. The district court denied the defendants’ motion to compel arbitration. The defendants appealed.
On February 19, 2025, the Seventh Circuit affirmed, holding that the defendants had waived their right to arbitrate through their litigation conduct and delay, and confirming that the district court, not an arbitrator, was the right decision-maker on the question.2Wallace Miller. ZocaLoans Class Action Lawsuit The defendants asked the full Seventh Circuit for en banc review; that was denied, and the case returned to the district court in April 2025.
Where the Case Stands in 2026
The plaintiff has since filed an amended complaint adding new parties. The defendants responded with a motion to dismiss and a renewed motion to compel arbitration. Both sides have briefed the motions, and the court has not yet ruled.2Wallace Miller. ZocaLoans Class Action Lawsuit
In March 2026, the Seventh Circuit decided Harris v. W6LS, Inc., a separate tribal lending case, and held that arbitration provisions requiring the application of tribal law that did not exist when borrowers signed their contracts were unenforceable.4U.S. Court of Appeals for the Seventh Circuit. Harris v. W6LS, Inc., No. 24-2056 Plaintiffs’ counsel has said they intend to use that ruling to argue that ZocaLoans’ arbitration clauses are similarly unenforceable. No class has been certified, and no settlement has been announced.
The Parallel California Case
A separate class action, Huntley v. Rosebud Economic Development Corp., was filed on August 10, 2022, in the Southern District of California, alleging violations of California’s Unfair Competition Law and the Rosenthal Fair Debt Collection Practices Act, among others.3Native American Rights Fund. Huntley v. Rosebud Economic Development Corp., Complaint In August 2023, that court ordered the dispute to arbitration.5Turtle Talk. California Federal Court Orders Arbitration in Tribal Sovereign Lending Case California borrowers looking to the ZocaLoans lawsuits for recovery should be aware that the California case is no longer proceeding in court.
777 Partners’ Financial Collapse
Anyone tracking the case for a potential payout should also know about the state of 777 Partners itself. In October 2025, both the SEC and the U.S. Attorney’s Office for the Southern District of New York moved against the firm’s leadership.
The SEC charged Joshua Wander, Steven Pasko, former CFO Damien Alfalla, 777 Partners LLC, and a related entity called 600 Partners LLC with fraud tied to a $237 million preferred equity offering. The agency alleged that between January 2021 and May 2024 the defendants concealed a severe liquidity crisis from investors, overdrew a credit facility by $300 million, and diverted roughly $33 million of investor funds to Wander and Pasko personally.6U.S. Securities and Exchange Commission. SEC Charges 777 Partners, Founders, and Former CFO With Fraud
Wander was indicted on charges of conspiracy to commit wire fraud, wire fraud, securities fraud, and conspiracy to commit securities fraud, each carrying up to 20 years in prison. He surrendered to federal agents on October 16, 2025. Alfalla had pleaded guilty two days earlier and is cooperating with the government.7Federal Bureau of Investigation. Founder and CFO of Investment Firm 777 Partners Charged With $500 Million Fraud Scheme All three executives resigned from 777 Partners and its subsidiaries in 2024, and a restructuring adviser was brought in.8U.S. Securities and Exchange Commission. SEC v. Joshua Wander, et al., Complaint Whether 777 Partners can fund a settlement or satisfy a judgment in the ZocaLoans case is an open question.
What ZocaLoans Borrowers Can Do Now
There is no settlement fund and no claims process. If you took out a ZocaLoans loan in Illinois, you may be eligible for the class if one is eventually certified. The attorneys at Wallace Miller have invited affected borrowers to contact the firm for a free consultation.2Wallace Miller. ZocaLoans Class Action Lawsuit
On paper, Illinois borrowers have a strong legal position. The Predatory Loan Prevention Act voids loans above 36%, and the Interest Act allows recovery of twice the interest charged by an unlicensed lender. Whether that translates into money in hand depends on the court’s rulings on the pending motions, class certification, and 777 Partners’ ability to pay.
If a collector is pressuring you over a ZocaLoans balance, know the limits on what they can do. A payday lender cannot garnish your wages or bank account without first suing you and winning a court judgment. The Consumer Financial Protection Bureau has warned that some payday lenders threaten garnishment to pressure borrowers when they have no court order to back it up.9Consumer Financial Protection Bureau. Can a Payday Lender Garnish My Bank Account or My Wages Threatening legal action a collector is not entitled to take violates the Fair Debt Collection Practices Act. You can file a complaint with the CFPB or contact your state attorney general’s office.