CHARLESTON - State Attorney General Darrell McGraw recently reached settlement agreements with 18 Internet payday lenders and filed suit in an attempt to enforce investigative subpoenas against 14 others.
The 18 companies who settled with McGraw's office promised to permanently discontinue payday loans in the state and to refund all unlawful fees and charges collected from state consumers.
McGraw says the agreement will result in tens of thousands of dollars in refunds and canceled debts for hundreds of consumers.
The 10 companies that have signed formal settlement agreements with Attorney General McGraw's office include: AnyDayCash.com; checkexpress.com; CNC Funding; Elite Cash Advance; FSM Processing; GetCash911.com; PayDay Advance Plus; Sordi, Inc.; Star Light Financial; and VIP Cash. The remaining eight have provided written confirmation that they will sign similar formal agreements.
In a press release, McGraw stated, "Last year we launched a major initiative to combat companies that were using the Internet to circumvent the laws of West Virginia intended to protect consumers from usurious loans. Today, we have sent a message that loans made to West Virginia consumers over the Internet must comply with our laws. We will take whatever legal action is necessary to protect our consumers from Internet predators."
McGraw's suit to enforce the subpoenas was filed Nov. 6 against Apple Fast Cash Personal Loans; Cash Advance Network; Cash Advance USA; Cash Advance Marketing; Cash Net; American Interweb Marketing; Leads Global; GECC; Americash Hotline; Magnum Cash Advance; Ambassador Financial.
Services; PayDay OK; QuikPayday.com; and USA Cash Center.
The Internet lenders are alleged to have made payday loans to consumers, claiming that states can not regulate their lending activities.
Payday loans are short-term loans secured by a post-dated check or by an agreement authorizing an electronic debit for the full loan amount plus interest from the consumer's account. McGraw alleges the companies deposit the loans electronically and demand interest rates more than 44 times greater than the maximum allowable rate for consumer loans in the state.