They claim to be exempt from state-level regulations:
Internet payday lenders with ties to Indians dodge California regulators - Los Angeles Times
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"Internet lending in general is something we've tried to get our arms around, and the tribal issue is a further complication," said Department of Corporations spokesman Mark Leyes. "Any California customer who is dealing with these lenders is not enjoying the consumer protections that are in state law."
Those protections give consumers the ability to file complaints with state regulators, who can intercede on behalf of borrowers and discipline Internet lenders by fining them or lifting their licenses. Currently, 16 Internet lenders are licensed by the state and must comply with the same rules as brick-and-mortar companies, Leyes said.
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Internet-based communications plus mass-marketing techniques makes this kind of scam financing toxic to the public. Here is a case where the Feds must step in pass some new regulations. The "free market" falls down yet again.