High interest payday loans are seen by critics as a fast track to endless cycles of debt for borrowers. Are they a scam? Some would say yes, although they're legal. Certainly no one would dispute that they're dangerous. That's why many states have adopted regulations intended to limit the damage payday loans can inflict on people's personal finances.

But a new breed of payday loan has emerged that does an end run around state regulations -- or so lenders hope. These are loans made online by Indian tribes, which claim sovereign immunity from state and local rules. So-called tribal lenders say they have to adhere only to federal regulations, which tend to be far less strict than what states have imposed.