Avant
Chicago consumer fintech (founded 2012 as AvantCredit) that lends to middle-income borrowers through bank-origination partnerships, was sued by the FTC in 2019 over loan servicing, and funds itself via securitizations.
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- Location
- Chicago, Illinois, United States
- Country
- United States
- Founded
- 2012 as AvantCredit by CEO Al Goldstein with co-founders John Sun and Paul Zhang; platform launched July 2013
- Known for
- Online personal loans, credit cards and personal financial management tools for middle-income US borrowers
- Structure
- Not a bank — Avant-branded credit products are originated by WebBank, a Utah industrial bank; Avant services the loans
- FTC enforcement
- Sued April 2019 over deceptive/unfair loan servicing; $3.85M settlement; $3.7M+ refunded to 17,367 consumers (Jan 2022)
- Funding model
- 23 personal-loan securitizations since 2012; ~$2.5B in long-term funding commitments; first AAA ratings (Fitch/KBRA) Feb 2026
Overview
Avant, LLC is a Chicago-based consumer financial technology company founded in 2012 as AvantCredit by CEO Al Goldstein with co-founders John Sun and Paul Zhang (VentureBeat). It offers personal loans, credit cards and personal financial management tools aimed at middle-income American borrowers (PYMNTS). The identity that matters most for understanding the company is structural: Avant is not a bank. Its branded credit products are originated by WebBank, a Utah-chartered industrial bank, under a lending-program agreement; WebBank makes the loans to consumers who apply through Avant’s website and sells them — including to Avant — within two days, while Avant services the loans (Lexology, describing the federal court record in Meade v. Avant).
The near-prime bet
Sun and Zhang had come through Y Combinator with Debteye, a startup that automated credit counseling, and saw what they described as a “huge product-gap” for near-prime customers — borrowers with below-average credit scores whose access to credit had tightened since the 2008 recession (VentureBeat). AvantCredit’s platform used machine learning to determine lending risk from dozens of data sources captured during the application itself, searching thousands of data attributes for patterns, and could approve and fund a loan of up to $10,000 in near real-time (VentureBeat). The company launched in July 2013 and that year raised a $20 million round led by August Capital and Victory Park Capital, on top of an earlier $9 million in equity and $25 million in debt (VentureBeat).
That bank-partnership structure later became a legal battleground. In Meade v. Avant, decided March 1, 2018, the U.S. District Court for the District of Colorado addressed claims by Colorado’s consumer-credit regulator that Avant had charged excess finance and delinquency charges in violation of state law (Lexology). Avant argued that because the loans were originated by a state-chartered bank, federal law completely preempted the state claims; the court rejected that argument, holding that the federal statute governed state-chartered banks and was not intended to displace regulation of lenders who are not banks (Lexology). The ruling left open the “true lender” question — whether the bank or the fintech partner is the real party in interest — a fault line that has defined the rent-a-bank debate across online lending (Lexology).
The FTC enforcement arc
In April 2019 the Federal Trade Commission sued Avant, LLC, alleging the company had engaged in deceptive and unfair loan servicing practices — “systemic issues with the company’s loan servicing platform,” in the words of the FTC’s Bureau of Consumer Protection director (FTC). The complaint alleged Avant withdrew money from consumers’ accounts or charged their credit cards without authorization — in some cases debiting a monthly payment twice or more, with one consumer’s payment debited 11 times in a single day — and that despite hundreds of consumer complaints and internal documents acknowledging the problem, the unauthorized charging continued (FTC). The FTC further alleged Avant falsely advertised that it accepted credit- and debit-card payments (rejecting them in practice), gave inaccurate payoff quotes, collected more than quoted payoffs, failed to credit check payments properly, and required borrowers to agree to recurring automatic bank debits as a condition of getting a loan, violating the Telemarketing Sales Rule and the Electronic Fund Transfer Act (FTC).
The stipulated order, filed in the Northern District of Illinois on April 15, 2019 and approved by a 5–0 Commission vote, imposed a $3.85 million judgment to be returned to harmed consumers, and barred Avant from taking unauthorized payments and from collecting payment by remotely created check (FTC). In January 2022 the FTC mailed more than $3.7 million in refund checks to 17,367 consumers, averaging $216 each (FTC).
The securitization engine
Behind the consumer-facing brand sits a capital-markets funding machine. In February 2026 Avant closed a $200 million personal-loan securitization — its 23rd since founding and its seventh revolving transaction — that became the first of its deals to earn AAA ratings from both Fitch Ratings and Kroll Bond Rating Agency (PYMNTS). The 24-month revolving structure, which lets Avant reinvest principal as loans are repaid, is expected to provide more than $500 million in financing capacity over the deal’s life; combined with existing asset funding commitments, the company reported about $2.5 billion in long-term funding commitments supporting its personal-loan and credit-card businesses (PYMNTS). The company says it uses data and machine learning to serve middle-income Americans with credit cards, personal loans and financial-management tools, and reports having connected more than 4 million unique customers to $13.2 billion in personal loans since 2013 and 2.9 million credit cards since 2017 — figures that are company-reported and have not been independently verified (PYMNTS).
What this profile does not claim
- This profile covers Avant, LLC — the Chicago consumer fintech founded in 2012 as AvantCredit by Goldstein, Sun and Zhang (avant.com). It is not a bank, not an insurer, and not any other company using the Avant name.
- Customer and loan-volume figures are company-reported via press coverage, not independently audited; they are presented as reported.
- The profile does not assert that the FTC’s 2019 injunctive provisions changed Avant’s servicing practices; no independent post-settlement assessment was found.
- Early growth and valuation claims from the company’s first years appear only in lower-tier coverage and are deliberately omitted.
- The “true lender” characterization of Avant’s bank partnership reflects the legal debate described in court reporting, not a final judicial determination on the merits of that specific question.
Timeline
- 2012
- Serial entrepreneur Al Goldstein starts AvantCredit in Chicago with co-founders John Sun and Paul Zhang, who had been through Y Combinator with Debteye, a credit-counseling automation startup. The target is "near-prime" borrowers — people with below-average credit scores poorly served since the 2008 recession — underwritten with machine learning over thousands of data attributes rather than credit score alone.
- 2013
- AvantCredit launches its platform in July and raises a $20M round led by August Capital and Victory Park Capital, having already raised $9M in equity and $25M in debt. Early loans are approved and funded in near real-time, up to $10,000.
- 2018
- In Meade v. Avant, the U.S. District Court for the District of Colorado rules on the company's lending structure: court filings establish that WebBank, a Utah-chartered industrial bank, makes loans to consumers who apply through Avant's website under a lending-program agreement, then sells the loans — including to Avant — within two days. Colorado's consumer-credit regulator had sued alleging excess charges; the court rejects Avant's claim that federal banking law completely preempts the state claims.
- 2019
- The FTC sues Avant, LLC in federal court (N.D. Illinois, filed April 15), alleging deceptive and unfair loan servicing: unauthorized withdrawals and duplicate debits (one consumer debited 11 times in one day), false advertising of card-payment acceptance, inaccurate payoff quotes, collecting beyond quoted payoffs, and conditioning loans on automatic bank debits. Avant settles for $3.85M, to be returned to harmed consumers, and is barred from unauthorized payments and remotely created checks.
- 2022
- In January the FTC mails more than $3.7M in refund checks to 17,367 consumers harmed by Avant's practices, averaging $216 per recipient.
- 2026
- Avant closes a $200M personal-loan securitization — its 23rd since founding and seventh revolving deal — the first to earn AAA ratings from both Fitch Ratings and KBRA. The 24-month revolving structure is expected to provide over $500M in financing capacity, bringing long-term funding commitments to about $2.5B.
What we could not verify
These claims came up in research and could not be confirmed. They are recorded here rather than published as fact or quietly dropped. If you hold a source that settles one, please tell us.
- Customer and loan-volume figures (e.g. 4M+ unique customers, $13.2B in personal loans since 2013, 2.9M credit cards since 2017) are company-reported via PYMNTS and are not independently verified.
- Whether the FTC's 2019 injunctive provisions materially changed Avant's servicing operations afterward is not documented in the independent sources found.
- Early growth figures (2012–2015 origination and investor-contribution totals) and any 'unicorn' valuation claims appear only in lower-tier coverage and are not stated.
Sources
5 sources (2 tier 1, 2 tier 2, 1 tier 3), each opened and read against the claim it supports. Every source is independent of the subject; no first-party material is cited. See the source policy.
Sources were selected for independence from the subject: FTC enforcement records (tier1), VentureBeat, PYMNTS and legal-industry reporting. Wikipedia was used only as a lead index and is not cited. No first-party sources were used per editorial rule — nothing from avant.com or company press releases is cited. Customer and loan-volume figures are company-reported via press coverage and are marked as such.
- Supports: FTC suit and settlement details — unauthorized charges and duplicate debits (11 debits in one day); false card-payment advertising; inaccurate payoff quotes; collecting beyond quoted payoffs; TSR/EFTA violations (conditioning loans on automatic debits); $3.85M judgment; prohibitions on unauthorized payments and remotely created checks; 5-0 Commission vote; filed N.D. Illinois April 15, 2019 Open original source
- Supports: $3.7M+ refunded to 17,367 consumers; average $216; underlying allegations recap (false card-payment advertising, unauthorized withdrawals, uncredited check payments, deceptive payoff quotes) Open original source
- Supports: Founding 2012 by Al Goldstein (CEO), John Sun and Paul Zhang; Sun/Zhang Y Combinator/Debteye background; Chicago-based; platform launched July 2013; near-prime target; ML underwriting over thousands of data attributes; near-real-time funding up to $10,000; $20M round led by August Capital and Victory Park Capital; prior $9M equity + $25M debt Open original source
- Supports: $200M personal-loan securitization (announced Feb 26, 2026); first AAA ratings from both Fitch and KBRA; 23rd securitization since 2012, seventh revolving; 24-month revolving period, $500M+ expected financing capacity; ~$2.5B long-term funding commitments; company-reported scale (4M+ unique customers, $13.2B personal loans since 2013, 2.9M credit cards since 2017); middle-income borrower focus; data/ML credit decisioning; Credit Builder tool and Dec 2025 customer figures Open original source
- Supports: Meade v. Avant (D. Colorado, March 1, 2018); WebBank lending-program agreement — WebBank originates loans made through Avant's website and sells them (including to Avant) within two days; Colorado UCCC administrator's suit over excess charges; court's rejection of complete FDIA preemption Open original source
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