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Monday, January 27, 2020

Payday loan enterprise targeted by legal action

By Shaun Zinck | Sep 1, 2015

Payday loans
NDG Enterprise, a payday loan enterprise was sued by the Consumer Financial Protection Bureau on Aug. 4 for allegedly collecting money from people that didn't owe. | Shutterstock

The Consumer Financial Protection Bureau sued a payday loan enterprise Aug. 4 for allegedly collecting money from people who didn't owe, said CFPB Director Richard Cordray.

NDG Enterprise, which is a “complex web of commonly controlled companies,” allegedly collected the loan and fees that were either void or weren't obligated to be paid by the person, Cordray said. The company also was accused of making threats to consumers of lawsuits and imprisonment.

“We are taking action against the NDG Enterprise for collecting money it had no right to take from consumers,” Cordray said. “Companies making loans within the U.S. have to comply with federal law, and the Consumer Bureau will work to ensure that American consumers receive the protections and fair treatment they deserve.”

Additionally, the lawsuit alleges the enterprise used wage-assignment clauses, which were illegal, to take payments directly from consumers' employers' payroll accounts.

The company collects payday loans over the Internet from consumers in all 50 states. New York state law actually voids the payday loans because it violates the state's usury caps and licensing requirements.

The lawsuit alleges the enterprise violates the Dodd-Frank Wall Street Reform and Consumer Protection Act, which prohibits deceptive, abusive and unfair acts and practices.

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