Virginia AG Obtains $480,000 Settlement with Small-Dollar Lender

Payday Lending  •  State AGs

On July 25, 2017, the Virginia Attorney General’s Office (Virginia AG) announced that it had reached a settlement with a small-dollar open-end credit lender.  According to the Virginia AG, the lender offered open-end cash advances, both at a storefront and online, through short term loans with interest rates as high as 240%, often in small amounts and to less advantaged consumers.

The Virginia AG ​​alleged that the lender violated the Virginia Consumer Protection Act (VCPA) by misrepresenting that it would not conduct credit checks on consumers, imposing finance fees during a statutorily-required grace period where no such fees could be charged, and by obtaining judgments in a particular venue without legal basis for that venue.  Under the settlement, the lender will provide over $450,000 in debt forgiveness, $14,000 in refunded fees, and $17,000 in interest forgiveness.  The lender has also agreed to a permanent injunction to refrain from misrepresenting that it will not perform credit checks, seeking judgments in an improper venue, or violating the VCPA in any other way.

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