CHARLESTON, W.Va. (Legal Newsline) - West Virginia Attorney General Darrell McGraw announced Wednesday he is suing eight more payday lenders and is demanding that the companies stop doing business in the state.
McGraw said in a statement he brought the suit against the companies for soliciting and servicing payday loans.
"When a company sets foot in West Virginia, whether in person or over the Internet, my office has a duty to ensure the enterprise complies with state law," McGraw said in a statement. "Any company that makes payday loans must halt its usurious business and produce records identifying its victims."
The suit asks the court to order the eight companies, which have refused to cooperate with the attorney general's investigation, to surrender the records of their West Virginia-based accounts and to halt lending activities in the state.
Illegal in West Virginia, payday loans are high-interest loans or cash advances with interest rates that reach as high as 600 percent to 800 percent APR. The loans, typically made for 14 days, are secured by a post-dated check or an agreement authorizing electronic debits from the consumer's checking account.
One of the companies named in the suit, Payday Loan Resource Center, has tried to circumvent state law by charging West Virginia customers a monthly fee to help them obtain Internet payday loans, McGraw's office said.
A lawsuit filed earlier this year by the Federal Trade Commission charged two of the companies, Ecash and GeteCash, with attempting to garnish wages without a court order. Another company, Lakota Cash, claims to be an Indian tribe and therefore not subject to the laws of any state, the attorney general's office said.
The companies and principals sued by McGraw's office include: Payday Loan Resource Center LLC and Moe Tassoudi of Scottsdale, AZ; DirectROI d/b/a Cash West Payday Loans and Mike Brewster of Chandler, AZ; First American Credit, LoanPointe LLC, Joe E. Strom, Benjamin J. Lonsdale, James C. Endicott and Mark S. Lofgren of Highland, UT; Eastbrook LLC d/b/a Ecash and GeteCash of Provo, UT; National Title Loans d/b/a National Cash 12 of Elsmere, DE; Payday Financial LLC d/b/a www.LakotaCash.com and Martin Webb of Timber Lake, SD; and Payday Loans-ACH d/b/a www.ACHLoans.com of Emeryville, CA.
Since McGraw started investigating the industry in 2005, his office has reached settlements with more than 100 Internet payday lenders and their collection agencies, resulting in $2,452,979.87 in refunds and canceled debts for 8,044 West Virginians.
"Payday loans are predatory traps for the many West Virginians facing difficult times," McGraw said. "We will continue to ask the courts to intervene whenever companies refuse to cooperate with our efforts to protect West Virginia citizens."
From Legal Newsline: Reach Jessica Karmasek by e-mail at email@example.com.