New York’s financial regulator sent a subpoena to Medley Opportunity Fund II last week as he investigates the hedge fund’s ties to payday lending, Bloomberg News reported yesterday. Department of Financial Services Superintendent Benjamin Lawsky is seeking records from the fund on its investments in payday lenders, including lending relationships or joint ventures. The inquiry is in its early stages and may not result in further action. Medley is among Wall Street investors who profited by backing payday lenders based offshore or associated with American Indian tribes, which some regulators say are exploiting loopholes to charge higher interest rates than state laws allow. The fund that Lawsky is probing backed Mark Curry’s MacFarlane Group Inc., a company that struck a deal with a tribe in Oklahoma to set up websites that charge more than 700 percent interest a year, Bloomberg News reported in November.
