Cuomo Administration Expands Investigation into Prohibited On The Web Payday Lending and Associated Consumer Abuses

Governor Andrew M. Cuomo today announced that their management is expanding its efforts to guard New Yorkers from unlawful, online payday lending and associated fraudulent tasks that damage customers. Included in an substantial and ongoing research, the Department of Financial Services (DFS) delivered subpoenas to 16 online lead generation companies suspected of misleading or deceptive marketing of unlawful, online pay day loans in ny. DFS suspects that these companies are putting consumers prone to punishment by collecting and offering their private information to unlawful online payday lenders as well as other businesses, including scam music artists, in breach of the latest York State legislation.

Early in the day this current year, my management established a study of online lenders that are payday and after this we have been expanding this research to guard New Yorkers from similar frauds that ensnare families in endless rounds of financial obligation, Governor Cuomo stated. We will continue steadily to follow this research anywhere it leads and make use of every device at our disposal to shield New Yorkers from people who look for to victim upon vulnerable customers.

Benjamin M. Lawsky, Superintendent of Financial Services, said, Payday financing is unlawful in nyc and thus could be the marketing that is deceptive of illegal loans by lead generators. Whats worse is the fact that weve received complaints from New Yorkers about to generate leads companies associated with frauds, harassing telephone calls, misleading marketing, and privacy breaches. New Yorkers could possibly get sucked as a seemingly endless black colored gap of customer punishment when they offer their painful and sensitive private information to these kinds of web sites.

Prospecting businesses never typically make pay day loans straight, but rather create internet sites advertising and marketing those illegal loans.

The lead generation companies entice consumers to provide them with sensitive personal information such as social security and bank account numbers and then may sell that information to payday lenders operating unlawfully in New York and other companies through promises of access to quick cash. Included in its research, DFS has heard complaints from ny customers against lots among these generation that is lead about false and deceptive marketing (including celebrity recommendations), harassing telephone calls, dubious solicitations, privacy breaches, along with other problems.

Some customers have complained to DFS about receiving telephone calls from suspected scammers after supplying their information that is personal to to generate leads organizations. These frauds consist of enticing the customers to load cash on a pre-paid debit card and make use of it to pay for significant upfront charges so that you can receive an on-line pay day loan. The consumers reported not receiving the promised loan after paying these substantial upfront fees. Todays action delivers a very good message to pay day loan lead generators and their system of online marketers that deceptive or misleading marketing of payday advances to New Yorkers is unsatisfactory.

Payday lending is illegal in ny under both criminal and civil usury statutes. In a few full instances, nevertheless, lenders try to skirt brand brand New Yorks prohibition on payday financing by providing loans on the internet, hoping to avoid prosecution. However, online lending that is payday along with the deceptive or misleading advertising of the loans to New Yorkers, is simply as illegal as payday financing built in individual in ny.

In August 2013, DFS demanded that 35 businesses cease and desist providing unlawful loans that are payday in violation of brand new York legislation. Nearly all these businesses (at the least 23) have previously ceased company in ny after getting the letters from DFS. Governor Cuomo additionally announced cash net usa loans fees in that Superintendent Lawsky sent letters to 117 banks as well as NACHA, which regulates the use of the Automated Clearing House (ACH) network and whose board includes representatives from a number of those banks requesting that they work with DFS to cut off access to New York customer accounts for payday lenders operating unlawfully august. Also Superintendent Lawsky delivered a page in August to any or all commercial collection agency businesses running in ny particularly directing them never to gather on illegal pay day loans from the firms DFS research had identified up to now, since such loans are null and void.

A summary of the 16 prospecting organizations to which DFS issued subpoenas is included below.

DFS is demanding a variety of materials as an element of its ongoing research, including advertising materials, agreements for sales of customer information and privacy policies.

  • Allied Cash Loan
  • Bahamas Advertising Group, Inc.
  • Blue Worldwide, LLC d/b/a 100DayLoans, HighSpeedPayday
  • DJR Group, LLC
  • Fix Media Group, LLC d/b/a We Fix Cash
  • Hydra Fund II
  • LightSword, LLC d/b/a Aero Advance
  • Cash Advance Ranger
  • Payday Flexibility
  • PayDayForest
  • PayDayMall
  • Personal Cash Loan
  • Attempting to sell Supply, LLC d/b/a MoneyMutual, LLC
  • US Money Loans
  • ValleyTrust
  • WebMarketerLive d/b/a JustClickHereLoans, CashMoneyNow

Customers can avoid prepaid credit card as well as other scams associated with cash advance lead generation internet sites with your easy precautions:

Consumers whom think that they are the target of the loan that is payday or lead generation firm running unlawfully or if a financial obligation collector is wanting to gather for an unlawful cash advance can register a grievance using the Department of Financial Services at (800) 342-3736. DFS has additionally published informative data on its web site for customers about combating unlawful payday loans online, that will be offered at the after website link.