State AG Files Five Lawsuits Against Payday Lenders

April 10, 2014
InsideARM 
payday lending news
Illinois Attorney General Lisa Madigan has filed five lawsuits as part of a crackdown on payday lending. On behalf of the Illinois Department of Financial and Professional Regulation (IDFPR), Madigan filed suit against four out-of-state online payday lenders for operating without a license: BD PDL Services LLC, Mountain Top Services I LLC, Red Leaf Ventures LLC, and VIP PDL Services LLC.

Under the Payday Loan Reform Act, fees are capped at $15.50 per $100 loaned, but these lenders charged $30. The law also prohibits payday lenders from issuing loans that would put consumers in debt to one or more payday lenders for more than 45 consecutive days or to consumers already carrying balances on two loans, and once loans are paid off, they must wait seven days before issuing another loan to the same borrower. 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 also sued MoneyMutual LLC, a lead generator that provides such data as personal banking information, Social Security numbers, birth dates, addresses, and employment records to payday lenders. Both MoneyMutual and the payday lenders received several cease-and-desist orders from IDFPR. The lawsuits seek to prevent these companies from doing business in the state, cancel pending payday loan contracts, provide full restitution for borrowers, and impose civil penalties.









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