Monday, October 18, 2021

Montel Williams Payday Lenders Get Hit by Attorney General

Must read

What Are Micromoments?

Performance marketing is the latest buzzword because it’s a must when it comes to optimising your brands’ digital marketing strategy. But with all...

FIGHTING AFFILIATE SCAMS WITH ANTI-FRAUD MECHANISMS AND STRATEGIES

PartnerMatrix CEO Levon Nikoghosyan explains how the company's affiliate marketing software platform can help affiliates and operators steer clear of fraud. The industry...

FTC Testifies Before Congressional Subcommittee on Legislation to Restore Enforcement Authority

The Federal Trade Commission recently testified before the House Energy and Commerce Subcommittee on Consumer Protection and Commerce on legislation to modify the FTC’s...

Breaking: Google and Doubleclick Exposed as Major Financial Partners with Fake News Sites

The top-10 most credible ad firms accounted for 66.7% of ad traffic on fake news websites, and another 55.6%% ad traffic on low-quality websites.
Avatar
Press Release
This is a press release issued by the company involved. Performance Marketing Insider publishes press releases that we feel are useful for the industry at large. You can send all press releases to press@pacedm2.wpengine.com

Attorney General Lisa Madigan today filed five lawsuits in a sweep cracking down on unlicensed, online payday lenders and a loan lead generator promoted by talk show host Montel Williams for illegally offering expensive, predatory loans that trap Illinois borrowers in excessive, cyclical debt loads.

Madigan filed lawsuits this week in Cook County Circuit Court on behalf of the Illinois Department of Financial and Professional Regulation (IDFPR) against four out-of-state payday lenders that are operating exclusively online, selling payday loans racked with fees that are double the amount allowed under state law. The lawsuits allege BD PDL Services LLC, Mountain Top Services I LLC, Red Leaf Ventures LLC and VIP PDL Services LLC charged Illinois borrowers $30 for every $100 loaned and allowed borrowers to take out multiple loans at once.

The Payday Loan Reform Act limits the fees a payday lender can charge a consumer to no more than $15.50 per $100 loaned. Payday lenders cannot issue a loan to a consumer if the loan would result in their being in debt to one or more payday lender for more than 45 consecutive days, and they cannot issue a loan to a consumer who already carries balances on two loans. Lenders must also wait seven days before issuing a loan to a repeat customer, once their loans are paid off.

“These online, unlicensed predatory lenders are putting Illinois consumers into unregulated, unprotected payday loans,” Madigan said. “None of these payday lenders is complying with the consumer protection we fought for over a decade to put into place to keep borrowers from being trapped in loans with excessive interest rates and fees.”

Madigan filed a fifth lawsuit against online broker MoneyMutual LLC for its role generating customer leads on payday loans with unlicensed lenders in violation of state law. The Attorney General’s lawsuit alleges the company was able to attract borrowers to its website in large part due to the profile of its celebrity spokesman Montel Williams.

Madigan also expressed concerns about the company’s data collection practices in light of the recent wave of major data security breaches. MoneyMutual requires potential borrowers to share their personal banking information, Social Security number, date of birth, driver’s license information, private address and employment records, all of which can be shared with third parties, putting borrowers at significant risk of identity theft.

Madigan’s lawsuits follow several cease and desist orders issued to the lenders and Money Mutual by IDFPR.

“Out-of-state lenders who ignore Illinois laws to take advantage of vulnerable consumers deserve to face the full weight of our laws,” said Manuel Flores, Acting Secretary of Financial and Professional Regulation. “It is gratifying that the Attorney General is backing up our cease and desist orders with demands for full restitution for the unwary borrowers.”

Madigan’s lawsuits ask the court to permanently ban the defendants from the payday loan business in Illinois, cancel pending payday loan contracts with Illinois consumers and require full restitution. The lawsuits also seek to impose on the defendants an array of civil penalties for violations of the Payday Loan Reform Act of 2005 and the Illinois Consumer Fraud and Deceptive Business Practice Act.

Assistant Attorneys General Sarah Poulimas and Khara Coleman Washington are handling the cases for Madigan’s Consumer Fraud Bureau

- Advertisement -

More articles

5 Comments

What's your opinion?

- Advertisement -

Latest article

What Are Micromoments?

Performance marketing is the latest buzzword because it’s a must when it comes to optimising your brands’ digital marketing strategy. But with all...

FIGHTING AFFILIATE SCAMS WITH ANTI-FRAUD MECHANISMS AND STRATEGIES

PartnerMatrix CEO Levon Nikoghosyan explains how the company's affiliate marketing software platform can help affiliates and operators steer clear of fraud. The industry...

FTC Testifies Before Congressional Subcommittee on Legislation to Restore Enforcement Authority

The Federal Trade Commission recently testified before the House Energy and Commerce Subcommittee on Consumer Protection and Commerce on legislation to modify the FTC’s...

Breaking: Google and Doubleclick Exposed as Major Financial Partners with Fake News Sites

The top-10 most credible ad firms accounted for 66.7% of ad traffic on fake news websites, and another 55.6%% ad traffic on low-quality websites.

Inside Instagrams Affiliate Plan

Good news: Instagram has upped its game once again from a creators point of view. In the rush to make the platform...