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Author Topic: Prosper Class Action Suit Settled for $10 Million Over 3 Years  (Read 212265 times)

xraider

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #45 on: July 28, 2013, 07:31:39 pm »

Maybe the settlement cant be announced until Prosper has convinced enough of its employees and investors to let Prosper borrow $10,000,000 in their names.
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Capital_Finance_Group

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #46 on: August 03, 2013, 12:12:43 pm »

I think money lost would be fairest as well.

Although the suit is over unregistered securities and this applies whether the loans paid back or not, nonetheless people whose loans didnt pay lost more than people whose loans did. Repayments can be regarded as a sort of setoff against claims.

It remains to be seen how much of the settlement money will end up in the hands of the lawyers.

I think settling for a fraction of the original claim was a smart move on Prospers part. It removes a huge cloud of uncertainty hanging over its future, and enables Prosper to seek new investors based only on its performance, without this additional can of worms.

I would think that the balance of your unpaid loans would be used. With the lawyers in the mix I am not sure that any method will do much for me.
IRA - do you think our payments will be credited to our Prosper accounts or will we recieve checks from a Settlement Fund?
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Beerbud1

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #47 on: August 03, 2013, 01:05:23 pm »

Wouldnt it be easiest to simply transfer the funds into each persons prosper account?

Those of course that the Court deems worthy of receiving the settlement!
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ira01

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #48 on: August 03, 2013, 01:41:31 pm »

IRA - do you think our payments will be credited to our Prosper accounts or will we recieve checks from a Settlement Fund?

Because the administrative costs of sending checks is very high, for little or no real benefit, I think it is likely that the money will just be credited to your Prosper account.  As long as the money can easily be withdrawn, I have no problem with that. 
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Fred93

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #49 on: August 03, 2013, 04:24:28 pm »

15 days, and nothing yet on the case docket.

Im skeptical that there is really an agreement.

112233

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #50 on: August 03, 2013, 04:56:05 pm »

Well it says PMI agrees to those terms, maybe their terms. It doesnt say anybody else does.
« Last Edit: August 03, 2013, 04:59:43 pm by 112233 »
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ira01

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #51 on: August 03, 2013, 05:14:56 pm »

15 days, and nothing yet on the case docket.

Im skeptical that there is really an agreement.

As I said above, I expect it will be a couple months before the details are hammered out.  And, of course, it is possible that things will blow up without agreement being reached on the details. 
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xraider

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #52 on: August 04, 2013, 07:47:25 am »

Fred, with Ira.  There are a LOT of details to be worked out, including how notices will be sent to class members, how payment will be made both to class members and to counsel etc.  Prosper and class counsel will want to agree on as much as possible and still make it palatable to the court and to class members. Class members who object to the settlement can opt out and bring their own suits, and too many objections (such as over a three year payment plan) could get the whole thing tossed.
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Fred93

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #53 on: August 04, 2013, 07:23:55 pm »

The prosper experience has taught me a lot about the legal system.

Way back when lenders were doing screening on borrowers, I learned how to lookup bankruptcy cases.

During Prospers ill-fated attempt to sue nonpayers, I learned how to find & track those cases on local court dockets.

This is my first time watching a class-action suit up close.  Its like watching the hour hands on a clock.

NewHorizon

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #54 on: August 05, 2013, 01:40:59 pm »

I think it is likely that the money will just be credited to your Prosper account. 

Im not sure its as easy as that.  Are all those Prosper accounts still open?  And/or are they all still linked to functioning bank accounts?

I think money lost would be fairest as well.

I cordially disagree. 

Cuz then youd end up paying the least-talented lenders the most money (respective to their outlays).  Prosper had nothing to do with each lenders loan-picking acumen relative to other lenders.  For example, if the old loans were registered securities, then me-thinks this wouldnt have prevented a muleshoes scenario from playing out.
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ira01

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #55 on: August 05, 2013, 02:10:37 pm »

I think it is likely that the money will just be credited to your Prosper account. 

Im not sure its as easy as that.  Are all those Prosper accounts still open?  And/or are they all still linked to functioning bank accounts?

Well, they are "open" unless the lender affirmatively closed it for some reason, and even there, I believe it is "open" to the extent that the lender can log on, get tax reports, move money out, etc.  And it doesnt matter if they are still linked to functioning bank accounts, because the lender can just add a new bank account if the old one is no longer good. 

A bigger problem is that no doubt some of the email addresses used by those accounts are no longer working, so lenders may not get Prosper notifications of the settlement, that money is there, etc.  So the agreement will need to require Prosper to take some additional steps to contact lenders for whom email notification appears not to be working.  Certainly snail mail notice is perfectly reasonable to require.  But I dont think it would be reasonable to require Prosper to go to the ends of the Earth to try to find missing lenders.  For them, I think that the settlement money (like any other money left at an old financial institution too long) should eventually escheat to the State.
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red12049

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #56 on: August 05, 2013, 02:36:08 pm »

I think it is likely that the money will just be credited to your Prosper account. 

Im not sure its as easy as that.  Are all those Prosper accounts still open?  And/or are they all still linked to functioning bank accounts?

I think money lost would be fairest as well.

I cordially disagree. 

Cuz then youd end up paying the least-talented lenders the most money (respective to their outlays).  Prosper had nothing to do with each lenders loan-picking acumen relative to other lenders.  For example, if the old loans were registered securities, then me-thinks this wouldnt have prevented a muleshoes scenario from playing out.


For the purpose of this settlement, what difference does talent make?

R
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artjunkie

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #57 on: August 05, 2013, 03:05:48 pm »

OK, so my account was tied to WAMU which is no longer in existence... so then Id probably have to sign the new lender agreement to add a new bank account.

I think Id rather let them keep the $.47
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moremoneymarc

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #58 on: August 05, 2013, 03:46:28 pm »

Assuming this is done like all my stock with stock options class action lawsuits were done there will be blanks for the owners to list the identifying loan number and amount lent for EVERY loan you had.  EVEN THOUGH THEY HAVE THIS INFORMATION already. 

The trade off historically seems to be that "our lawyers will not have their costs disputed by Ps lawyers and get their cash upfront"  if they can make sure enough lenders never fill out the required paperwork by making the task as difficult as possible.

 I predict we will also have to list each payment actually made to us out to about 12 decimal places  and date the payments.  Likely you will have to transfer all of this information to paper that will be optically scanned in by yet another third party.

Seriously this is how stock and stock options class actions have been handled in the past.  There were also different awarding class date periods.  Each period was awarded a different payout metric (calculation method). 
 

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Mark12547

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Re: Prosper Class Action Suit Settled for $10 Million Over 3 Years
« Reply #59 on: August 05, 2013, 03:54:23 pm »

A bigger problem is that no doubt some of the email addresses used by those accounts are no longer working, so lenders may not get Prosper notifications of the settlement, that money is there, etc.  So the agreement will need to require Prosper to take some additional steps to contact lenders for whom email notification appears not to be working.  Certainly snail mail notice is perfectly reasonable to require. But I dont think it would be reasonable to require Prosper to go to the ends of the Earth to try to find missing lenders.  For them, I think that the settlement money (like any other money left at an old financial institution too long) should eventually escheat to the State.

The only thing beyond "snail mail" and email may be calling last known phone numbers of those who dont respond and some sort of press announcement. When I volunteered for the Foundation at the local community college, we tried to collect as much contact information as possible because often when people move one of the contact methods might still get through.

At the local community college we had roughly 30% street address changes a year for students, a smaller percentage for the Foundation contributors, maybe around 15%. Unfortunately, I dont have info on change of phone numbers. When I left, we were giving students a lifetime email address, but a perusal of the web indicates that a third of the email addresses change each year.

But I agree that it isnt reasonable to require more effort on tracking down members of the class than emailing, mailing, and possibly telephoning.
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