Indiana Payday Loan Firm Fined $100,000 for Abusive Practices - OppLoans

Indiana Payday Loan Firm Fined $100,000 for Abusive Practices - OppLoans Indiana Payday Loan Firm Fined $100,000 for Abusive Practices Indiana Payday Loan Firm Fined $100,000 for Abusive PracticesInside Subprime: March 8, 2019By Grace AustinThe Consumer Financial Protection Bureau is forcing an Indiana payday loan firm to pay up for illegally debiting payments and making harassing phone calls toward customers, among other allegations.The CFPB settled with the payday loan firm, which has dozens of stores across the Midwest and South, in February 2019. The payday lender will have to pay a $100,000 penalty.The payday loan firm is accused of debiting borrowers even after their payday loans were paid back; the lender allegedly collected more than $20,000 from borrowers this way. The CFPB also says that illegal debiting likely led to overdraft and insufficient funds fees for borrowers.The payday loan firm is also charged with having “inadequate processes” to catch any unauthorized charges against its borrowers. Additionally, the payday loan firm didn’t have a sufficient refund process, meaning some customers didn†™t receive their money back for more than two years.The CFPB also accused the payday loan firm of making harassing phone calls to family members, employers, and any personal references that were included on the borrower’s loan applications from January 2014 to at least February 2017.The payday loan firm representatives would talk directly to or leave messages with those people until the loan was paid back by the borrower.The CFPB said it would sometimes go even further: “In some instances [the payday loan firms representatives] asked the third party to make a payment on the loan him or herself or sought to have the third party apply pressure on the borrower to make the payment.”The payday loan firm didn’t keep a sufficient do-not-call list internally, according to the bureau, so sometimes representatives would continue to call people even after they asked to not be contacted.Borrowers’ delinquent debts were exposed to their employers, co-workers and loved ones; the CFPB sa ys in the complaint that it led to “reputational damage in the workplace, disciplinary action, lost work time, and other negative employment consequences” for borrowers.The CFPB says that the payday loan firm didn’t need to involve third-party references like employers and family members to collect debts since they already had borrowers’ information on file for collections purposes.There are more allegations against the payday lender:The payday loan firm is accused of making marketing calls to those people listed as references on borrowers’ loan applications. The payday loan firm is also accused of advertising services it did not offer, such as check cashing, phone reconnections, and home telephone connections, on their storefront signs. The CFPB says at least 20 stores advertised these services, which some hadn’t offered, in some cases, for up to eight years prior.In addition, the bureau found that  the payday loan firm  violated the law by not providing privacy notices , as well as being deceptive about interest rates in its advertising.The Indiana-based payday loan firm has nearly $3 million in assets, according to the CFPB. Thus, a $100,000 fine is less than 5 percent of their total assets.The CFPB, under the current and immediate past director, has been accused of going soft on bad actors in the financial services industry by critics. The bureau recently charged a man swindling veterans $1 for his crimes.For more information on  payday loans, scams, and  cash advances  and  check out our  city and state financial guides  including Indiana, Illinois, Kentucky, Ohio and more.Visit  OppLoans  on  YouTube  |  Facebook  |  Twitter  |  LinkedIn