Arizona Attorney General Mark Brnovich said residents who were forced into loans with interest rates as high as 169% could be compensated.
PHOENIX – Arizonans who were coerced into taking out a fraudulent loan from CashCall may be entitled to receive financial restitution.
Arizona Attorney General Mark Brnovich said Wednesday that an agreement to resolve a lawsuit against CashCall is on the table, which would require the company to pay the state $4.8 million.
CashCall is accused of allowing Arizona consumers to take out personal loans with illegal interest rates of up to 169%.
Brnovich’s office claims CashCall engaged in deceptive lending practices under a company named Western Sky.
“Of the approximately $41 million that CashCall illegally collected on WS loans, nearly $26 million of that amount was interest, thanks to the extraordinarily high interest rates charged on WS loans,” court records say. .
In addition to providing restitution to consumers who were harmed, the court’s proposed settlement requires the defendants to cease all collections and cancel all outstanding loans in Arizona. Defendants are also prohibited from engaging in other lending activities that do not comply with Arizona law.
A consumer compensation fund is being established for the payment of refunds to eligible consumers. Once the proposed judgment – pending court approval – is approved, borrowers eligible for reimbursement will receive a check in the mail.
“Our office will not tolerate unscrupulous lenders preying on vulnerable Arizona consumers,” Brnovich said in a statement. “…this case is emblematic of our commitment to hold all businesses accountable for any deceptive actions or predatory lending practices.”
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