WASHINGTON (Legal Newsline) — Karl A. Racine, the attorney general for the District of Columbia, announced Jan. 11 that lender CashCall has agreed to repay more than $1.8 million in debt payments made by district consumers. The company will also forgive more than $1 million in remaining loan debt.

 

According to Racine’s office, CashCall violated the district’s Consumer Protection Procedures Act and Debt Collection Law. The company purportedly charged astronomical interests rates that ranged from 80 percent to 169 percent. These alleged rates far exceed the 24 percent allowed under district law.

 

“Extremely high-interest loans, like the ones this company offered, trap borrowers in debt and are illegal in the District of Columbia,” Racine said. “Our Office of Consumer Protection worked to recover the maximum amount of restitution possible. We are pleased to announce that more than 1,300 district residents who were victimized by these lending practices will get back some of the money they paid to CashCall to cover exorbitant -- and illegal -- interest rates.”

 

CashCall also will pay $100,000 in penalties to the district, ask credit reporting agencies to remove credit entries made regarding consumer loans via CashCall, and stop business practices in the district until obtaining proper licensing.

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