BOSTON (Legal Newsline) – Massachusetts Attorney General Maura Healey and the Division of Banks have reached a settlement with Western Sky and CashCall over an alleged illegal online lending scheme.
The settlement follows allegations that these small installment loan lenders and their affiliated companies made illegal high-interest loans online to thousands of consumers. These entities also did not have proper license or registration to do business in the state, according to the Attorney General’s Office.
“These companies targeted thousands of financially stressed consumers in need of a loan, and charged exorbitant interest rates and fees, causing these consumers and their families to incur even greater economic strain,” Healey said. “We are pleased to have worked with the Division of Banks in order to obtain significant restitution for consumers who were harmed, and permanently stop these lenders from doing business in Massachusetts.”
Under the terms of the agreement, these companies can no longer do business in the state, and consumers will be entitled to a refund if their total payments exceed the principal loaned to the borrower, plus the statutory maximum 12 percent interest rate. For consumers who do not match these needs, the companies must modify all outstanding loans to help the consumers pay down their balance without penalty.