Payday lender settles with North Carolina AG for $ 825,000

On January 27, the North Carolina Attorney General ad that a Florida-based payday lender (lender) agreed to pay $ 825,000 to settle allegations of usury, unlicensed loaning, illegal debt collection and unfair and deceptive practices in violation of the laws of the State on consumer protection. According to the announcement, although the lender is not licensed in the state, it has made “over 400 loans online to financially troubled consumers in North Carolina at interest rates between 78 and 252. % ”, Which is significantly above the state’s interest rate limit of 30 percent. The AG claimed the lender attempted to circumvent North Carolina laws by forcing some borrowers to collect their loan funds out of state. The AG also alleged that the lender required borrowers to secure the loans with their vehicle titles, which allowed the lender to repossess and sell the borrowers’ vehicles in the event of default or late payment. . In the regulation, without admitting the AG’s allegations, the lender agreed to return to the North Carolina borrowers (i) all fees and interest paid on the loans by the borrowers; (ii) all auction proceeds exceeding the loan principal to borrowers whose vehicles have been repossessed and auctioned; and (iii) cars owned by borrowers that have been seized but not auctioned. Among other things, the lender will also be permanently prohibited from making loans to and collecting payments from North Carolina borrowers, and will be prohibited from putting liens on and repossessing vehicles belonging to them. to borrowers.

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