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Tinian’s Payday Loan company closed down
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Posted on May 16 2006
The Attorney General’s Office secured a court order from Judge David Wiseman last Thursday putting EC Payday of Tinian permanently out of business.
This comes after the AGO alleged that the company had committed multiple violations of the Consumer Protection Act.
The company, which operated a payday loan business, was alleged to have charged consumer as much as 24 percent of their next payday in exchange for instant cash. These short-term loans, usually the length of one government pay period, translate into interest amounts as high as 62 times the amount of interest that is legally enforceable under Commonwealth law, the Attorney General’s alleged.
In addition, the Attorney General’s Office alleged that the business failed to disclosed federally mandated credit terms on the loan documents such as the Annual Percentage Rate, and the amount financed. This, the Attorney General alleged, created the likelihood that consumers would be confused or misunderstand the true cost of their credit.
In addition to shutting the business down, the court ordered the business to pay limited restitution to 157 separate consumers who can expect money orders shortly. The court also ordered the business to pay the CNMI Treasury $35,000 in civil penalties.
“This is a win for consumers,” said Attorney General Matthew Gregory, who noted that this is not the first time the Attorney General’s Office has obtained court-assisted relief against high-interest loan companies on Tinian recently.
“We want to send a strong signal to all businesses that this office intends to enforce the usury and consumer protection laws of this Commonwealth. We will not tolerate predatory lending practices, especially in these tough economic times when consumers are particularly vulnerable to offers of quick cash,” Gregory said.
He promised more enforcement actions as needed. (PR)
