Attorney General Raoul announces settlement with companies over predatory payday loans – The Southland Journal
Attorney General Raoul announces settlement with companies over predatory payday loans (Chicago, IL) – Attorney General Kwame Raoul and Illinois Department of Financial and Professional Regulation (IDFPR) Acting Secretary Mario Treto Jr. today announced a settlement with online payday loan lead generators MoneyMutual LLC; PartnerWeekly LLC and Selling Source LLC.
The settlement solves the Attorney General and IDFPR allegations that the companies violated Illinois lending laws by generating unlicensed payday loan leads and arranging high-cost payday loans for out-of-state payday lenders. the state, many of which were also unlicensed. Raoul and IDFPR alleged that the companies violated Illinois’ Consumer Fraud and Deceptive Marketing Practices Act by misrepresenting their lending network as trustworthy; however, the terms and conditions of the loan did not comply with Illinois law. The settlement filed with Cook County Circuit Court requires companies to immediately stop offering loans to unlicensed Illinois borrowers.
“Payday lenders disproportionately target low-income communities and communities of color, and they make it extremely difficult, if not impossible, for people to escape the cycle of poverty,” Raoul said. “I pledge to protect Illinois residents from payday lenders who operate illegally and trick people into expensive loans with unaffordable interest rates.”
The attorney general’s office filed suit against the companies in 2014 after the companies refused to comply with a cease and desist order issued by the IDFPR requiring them to obtain a license.
“The department is proud to protect Illinois consumers from unlicensed lenders who target them and their hard-earned income,” said Mario Treto, Jr., acting secretary of the Illinois Department of Financial and Professional Regulation. ‘Illinois. “We take this responsibility seriously and will continue to fulfill our mission as opportunities arise in the future.”
According to the lawsuit, MoneyMutual was able to attract borrowers to its website largely by using advertisements featuring former television host and celebrity spokesperson Montel Williams. The companies reportedly generated customer leads by collecting personal financial information from tens of thousands of Illinois consumers who applied for loans on the MoneyMutual website. The companies sold this personal financial information to payday lenders who used it to offer loans to potential borrowers.
The attorney general’s office also alleged that the companies’ misleading advertising misled borrowers into believing that the companies’ network lenders were licensed and abiding by the law. However, many lenders were not licensed or licensed to lend to Illinois consumers and charged exorbitant and illegal interest rates and finance charges.
The settlement prohibits the three companies from pursuing the following practices:
- Arrange or offer small loans, online or otherwise, without being licensed by the IDFPR.
- Advertise or offer small consumer loans or lead generation services in the State of Illinois, unless licensed by the IDFPR.
- To provide services related to arranging or providing small dollar loans to Illinois consumers without being licensed by the IDFPR.
Senior Assistant Attorney General Tom James handled the lawsuit for Raoul’s Consumer Fraud Bureau.
Attorney General Raoul announces settlement with companies over predatory payday loans