Company profit – Stormbirds http://stormbirds.net/ Sat, 24 Sep 2022 13:52:30 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://stormbirds.net/wp-content/uploads/2021/07/icon-2021-07-05T151758.466-150x150.png Company profit – Stormbirds http://stormbirds.net/ 32 32 Predatory payday loan companies and fraudsters thrive amid uneven laws and stolen data, new BBB research finds https://stormbirds.net/predatory-payday-loan-companies-and-fraudsters-thrive-amid-uneven-laws-and-stolen-data-new-bbb-research-finds/ Sat, 24 Sep 2022 13:52:30 +0000 https://stormbirds.net/predatory-payday-loan-companies-and-fraudsters-thrive-amid-uneven-laws-and-stolen-data-new-bbb-research-finds/ As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has […]]]>

As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has also created a fertile environment for scam artists, according to a new in-depth study from the Better Business Bureau. (BBB).

Payday loan laws are managed from state to state among the 32 states in which they are available, and a complex web of regulations makes the impact of the industry in the United States and Canada difficult to understand. follow. The BBB study, however, finds a common thread in the triple-digit interest rates that many of these loans carry – camouflaged by interest compounded weekly or monthly, rather than annually, as well as significant rollover fees.

From 2019 to July 2022, BBB received nearly 3,000 customer complaints about payday loan companies, with a disputed dollar amount of nearly $3 million. In addition, over 117,000 complaints have been filed against debt collection companies at BBB. Complainants often said they felt ill-informed about the terms of their loans. Many fall into what consumer advocates call a “debt trap” of racking up interest and fees that can force customers to pay double the amount originally borrowed.

The scammers haven’t missed an opportunity to take advantage of consumers either, with BBB Scam Tracker receiving over 7,000 reports of loan and debt collection scams representing around $4.1 million in losses.

Posing as payday loan companies and debt collectors, scammers use stolen information to trick consumers into handing over banking information and cash. In one case, BBB discovered that hackers had stolen and released detailed personal and financial data for more than 200,000 consumers. News reports indicate that this is not an isolated incident.

Regulators at the federal level have passed tougher laws to combat predatory lending, but those regulations have been rolled back in recent years, leaving states to set their own rules on interest rate caps and other aspects of lending. on salary. More than a dozen states introduced legislation last year to regulate payday loans, but the landscape of legally operating payday lenders remains inconsistent across states.

Currently, payday loans are not allowed in 18 states, according to Pew Charitable Trust. In addition, the Military Loans Act sets a rate of 36% on certain payday loans. When it comes to fraudulent behavior, law enforcement is limited in what they can do to prosecute payday loan scams. Some legal payday lenders have attempted to prevent scams by educating consumers about the ways in which they will or will not contact borrowers.

The BBB study advises consumers to thoroughly research all of their borrowing options — as well as the terms of a payday loan — before signing anything for a short-term loan. The study also includes recommendations for regulators:

  • Cap consumer loans at 36%
  • Educate more people about no-cost extended repayment plans
  • Require lenders to test whether consumers can repay their loans
  • Require Zelle, Venmo, and other payment services to offer refunds for fraud

Where to report a payday loan scam or file a complaint:

  • BBB.org/ScamTracker
  • Federal Trade Commission (FTC) – ReportFraud.ftc.gov
  • State attorneys general can often help. Find your state attorney general’s website to see if you can file online.
  • If you have an overdue payment on a payday loan, the Consumer Financial Protection Bureau may have resources to help you establish a payment plan.

Find more information about this study and other BBB scam studies at BBB.org/scamstudies.

Did you like what you just read?

Show your support for local journalism by helping us do more. It’s a kind and simple gesture that will help us continue to tell you stories like this.

Click to donate

]]>
Predatory payday loan companies and fraudsters thrive amid unequal laws and stolen data https://stormbirds.net/predatory-payday-loan-companies-and-fraudsters-thrive-amid-unequal-laws-and-stolen-data/ Wed, 21 Sep 2022 18:16:00 +0000 https://stormbirds.net/predatory-payday-loan-companies-and-fraudsters-thrive-amid-unequal-laws-and-stolen-data/ As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has […]]]>

As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has also created a fertile environment for scam artists, according to a new in-depth study from the Better Business Bureau. .

From 2019 to July 2022, BBB received nearly 3,000 customer complaints about payday loan companies, with a disputed dollar amount of nearly $3 million. In addition, over 117,000 complaints have been filed against debt collection companies at BBB.

Complainants often said they felt ill-informed about the terms of their loans. Many fall into what consumer advocates call a “debt trap” of racking up interest and fees that can force customers to pay double the amount originally borrowed. A St. Louis, Missouri woman recently told BBB that over the course of her $300 loan, she paid over $1,200 and still owed an additional $1,500.

The scammers haven’t missed an opportunity to take advantage of consumers either. Posing as payday loan companies and debt collectors, scammers use stolen information to trick consumers into handing over banking information and cash. In one case, BBB discovered that hackers had stolen and released detailed personal and financial data for more than 200,000 consumers.

The BBB study advises consumers to thoroughly research all of their borrowing options — as well as the terms of a payday loan — before signing anything for a short-term loan.

]]>
Cash Express, LLC Files Data Breach Notice for Unauthorized Access to Company’s Computer Network | Console and Associates, PC https://stormbirds.net/cash-express-llc-files-data-breach-notice-for-unauthorized-access-to-companys-computer-network-console-and-associates-pc/ Tue, 20 Sep 2022 18:07:32 +0000 https://stormbirds.net/cash-express-llc-files-data-breach-notice-for-unauthorized-access-to-companys-computer-network-console-and-associates-pc/ On September 15, 2022, Cash Express, LLC filed a data breach with the Montana Attorney General after the company suffered a data breach involving an unauthorized party with access to sensitive consumer data contained on Cash’s network. Express. According to Cash Express, the breach resulted in the compromise of first and last names, dates of […]]]>

On September 15, 2022, Cash Express, LLC filed a data breach with the Montana Attorney General after the company suffered a data breach involving an unauthorized party with access to sensitive consumer data contained on Cash’s network. Express. According to Cash Express, the breach resulted in the compromise of first and last names, dates of birth, contact information, social security numbers, driver’s license numbers and financial information belonging to certain individuals. Recently, Cash Express sent data breach letters to all affected parties, informing them of the incident and what they can do to protect themselves against identity theft and other fraud.

What we know about the Cash Express data breach

News of the Cash Express data breach comes from the company’s official filing with the Montana Attorney General as well as a notice posted on the Cash Express website. According to these sources, on February 6, 2022, the company detected unusual activity on its computer network. In response, Cash Express secured its systems and then hired a third-party data security company to help investigate the company.

As a result of this investigation, Cash Express has confirmed that an unauthorized party gained access to certain files on the company’s computer network between the dates of January 29, 2022 and February 6, 2022. It was also disclosed to the During the investigation that some of the files accessed by the unauthorized party contained sensitive consumer information.

After discovering that consumer data was accessible to an unauthorized party, Cash Express then reviewed the affected files to determine what information was compromised and which consumers were affected. The company completed its review of the affected files on August 4, 2022. While the information disclosed will vary depending on the individual, it may include your first and last name, date of birth, contact information, social security number, your driver’s license number and financial information.

On September 15, 2022, Cash Express sent data breach letters to everyone whose information was compromised as a result of the recent data security incident.

Founded in 1995, Cash Express, LLC is a check cashing company based in Cookeville, Tennessee. The Company offers a variety of loans and related services to its customers, including flexible loans, payday loans, installment loans, title loans, check cashing services, pawnbrokers, and more. Cash Express has dozens of locations in Tennessee, Kentucky, Georgia, and Arkansas. Cash Express employs over 240 people and generates approximately $52 million in annual revenue.

How Hackers Use Social Security Numbers

Hackers and other cybercriminals are constantly developing new ways to obtain consumers’ personal information. Social security numbers are perhaps the most valuable of all information, from a hacker’s perspective. But how can they take advantage of your stolen SSN? Most people assume that identity theft or unauthorized transactions are the worst damage that can result from a data breach; however, this is not necessarily the case, especially when they get your social security number.

Criminals have several ways to profit from stolen social security numbers.

Open credit cards or take out loans

The most common harm from a data breach is that hackers use your information to open a new line of credit, such as a new credit card or personal loan. This gives criminals quick access to a large sum of money that they can use to purchase goods on your behalf. To open a new credit account, a hacker needs your social security number, as well as your name, date of birth, and address. However, once they have your name and social security number, getting the other information won’t be too much of a hassle. For example, in the Cash Express data breach, all of these types of data appear to have been leaked. And even if a hacker is missing certain information, they may gain access to your other data through another data breach, an existing database of compromised information, or by searching online using the information. volleys he already has.

Tax refund fraud

A hacker who steals your social security number can quite easily file a fraudulent tax return on your behalf in hopes of intercepting your tax refund. To do this, they just need to file a tax return in your name before you do. Unfortunately, victims of tax refund fraud often don’t realize they’ve been targeted until the IRS rejects their tax return because it’s already been filed. To reduce the chances of a hacker successfully committing tax refund fraud, you should file your tax return as soon as possible.

Open fraudulent utility accounts

According to the Federal Trade Commission, 13% of fraud incidents in 2016 involved criminals setting up new phone and utility accounts. Although the harms of utility fraud may not seem as great as those of other types of fraud, the regulations surrounding the utility industry can make resolving a utility fraud case extremely difficult and time-consuming. To open a utility account, all a hacker needs is your name, address, and social security number.

Of course, in many cases the hackers are not committing identity theft or fraud themselves. Instead, they post your information for sale on the dark web and resell it to the highest bidder. This allows hackers to make a quick profit and move on to the next cyberattack and the next group of victims.

The Cash Express data breach is still under investigation; however, even at this early stage, it appears that those affected by the incident are at increased risk of identity theft and other fraud. If you have done business with Cash Express and would like to review the company’s data breach letter and learn more about your legal options, click here to review our recent article on the subject.

]]>
Payday lenders disappear from Bellevue, rest of state after interest capped at 36% | Nice view https://stormbirds.net/payday-lenders-disappear-from-bellevue-rest-of-state-after-interest-capped-at-36-nice-view/ Sat, 17 Sep 2022 13:00:00 +0000 https://stormbirds.net/payday-lenders-disappear-from-bellevue-rest-of-state-after-interest-capped-at-36-nice-view/ Nebraska payday lenders have all closed in the two years since voters capped the interest rate they could charge. The latest handful waived their delayed depository services business licenses in December, according to records maintained by the Nebraska Department of Banking and Finance. Just six months earlier, there were 19 such companies. That, in turn, […]]]>

Nebraska payday lenders have all closed in the two years since voters capped the interest rate they could charge.

The latest handful waived their delayed depository services business licenses in December, according to records maintained by the Nebraska Department of Banking and Finance.

Just six months earlier, there were 19 such companies. That, in turn, was down from the 65 businesses allowed on June 30, 2020, shortly before Nebraskanians passed a ballot measure limiting businesses to charging 36% annual interest. The measure was passed with more than 80% support.

People also read…

Former state senator Al Davis of Hyannis, a Nebraskans leader for responsible lending who pushed the ballot measure, offered only fake sympathy about the demise of the lending industry. Nebraska.

“Isn’t that a shame!” he said, adding, “They presented themselves as good Samaritans helping people, but they were anything but.”

Davis said he didn’t expect all payday lenders to close, though he expected the number of such businesses to drop significantly. He noted that industry officials predicted ahead of the 2020 vote that some lenders were likely to hang on.

On the other side, Ed D’Alessio, executive director of INFiN, a national trade association representing deferred deposit companies, said the shutdowns were predictable, based on the experience of other states that have imposed similar rate caps.

“Nebraska’s 36% rate cap on deferred deposit loans was never about consumer protection,” he said. “It was about the thinly veiled desire of activists to eliminate a regulated service loved by many.”

D’Alessio predicted that “Nebraska is likely to learn the hard way that illegal lenders thrive under restrictive, arbitrary, and antiquated rate caps, with little consumer protection.”

Payday loans, also known as cash advances, check advances, or deferred deposit loans, are a type of short-term, high-cost borrowing that people use to obtain small amounts immediate money.

Lenders typically charge a 15% fee, rather than traditional interest, for a short period. For example, a customer could write a check for $100 dated two weeks in the future, and the lender would give that person $85 in cash. When translated into an annual interest rate, the results can be surprising.

A state report showed that Nebraska payday borrowers ended up paying an average annual rate of 405% in 2019. The 1994 state law authorizing payday lenders in Nebraska exempted them from the general cap on 16% on interest rates.

As a result, borrowers can find themselves in a spiral of debt, in which they pay hundreds or thousands of dollars in fees over time and fall further and further behind financially. Some lose bank accounts or even end up in bankruptcy.

Reports from the state banking department showed that approximately 50,000 people took out payday loans in Nebraska in 2019. The average loan was $362, and the average person got 10 loans during the year.

The coalition that called for a rate cap on the ballot and lobbied for its passage included several organizations that work with or advocate for Nebraska’s low-income families, children and seniors — the groups most likely to be affected by payday loan debt.

In response, industry representatives argued that the cap would bankrupt most, if not all, payday lenders and leave customers without good alternatives when they need money.

Kent Rogert, a lobbyist for payday lenders, said the 36% cap meant payday lenders could only earn about $1.38 per $100 lent, which isn’t enough to survive in a business that sees up to 40% of loans in default.

“The amount of money you would earn is less than what it would cost to process these transactions,” he said. “You can’t pay the lighting bill for this.”

Rogert noted that some old deferred deposit businesses may still be open to provide other services, such as cashing paychecks for a fee. He said he didn’t know what former customers were doing now if they needed money fast.

But a 2017 report from the Center for Responsible Lending said research in other states found people were turning to cheaper ways to get cash when the payday loan industry shut down. These include borrowing from family and friends, getting credit card advances, cutting expenses and tapping into savings.

Patricia Herstein, general counsel for the Nebraska Banking Department, cited other options. She said some people might use installment loan companies, which are allowed to charge up to 24% interest on the first $1,000 and 21% thereafter.

Others may have crossed state lines to find payday lenders in Iowa or other states. Some have turned to online lenders, which generally charge very high rates and are not regulated by the state. Herstein said the state agency has filed complaints about online entities and contacted them with mixed success.

She and James Goddard, senior program manager for Nebraska Appleseed, another group that backed the ballot measure, said more Nebraska credit unions were offering small-value loans.

So far, Goddard said, Nebraskanians in need of money seem to be finding ways. He said Appleseed hasn’t heard from community members saying they’re struggling to find alternatives, unlike what they’ve heard from people struggling after taking out payday loans.

“It’s a harmful product that has trapped people in a cycle of debt,” he said.

]]>
US consumer watchdog plans to regulate ‘buy now, pay later’ companies https://stormbirds.net/us-consumer-watchdog-plans-to-regulate-buy-now-pay-later-companies/ Thu, 15 Sep 2022 22:40:00 +0000 https://stormbirds.net/us-consumer-watchdog-plans-to-regulate-buy-now-pay-later-companies/ Join now for FREE unlimited access to Reuters.com Register Sep 15 (Reuters) – The U.S. Consumer Financial Protection Bureau (CFPB) plans to start regulating “buy now, pay later” (BNPL) companies like Klarna and Affirm Holdings (AFRM.O) amid concerns Funding related to their fast-growing products are hurting consumers, the agency said Thursday. The watchdog, which does […]]]>

Join now for FREE unlimited access to Reuters.com

Sep 15 (Reuters) – The U.S. Consumer Financial Protection Bureau (CFPB) plans to start regulating “buy now, pay later” (BNPL) companies like Klarna and Affirm Holdings (AFRM.O) amid concerns Funding related to their fast-growing products are hurting consumers, the agency said Thursday.

The watchdog, which does not currently oversee BNPL companies or products, will issue guidelines or a rule to align industry standards with those of credit card companies, he said. The agency also said it would implement appropriate surveillance reviews.

The development will be a blow to the sector, which is already under pressure due to rising financing costs and falling US consumer spending during soaring inflation. Read more

Join now for FREE unlimited access to Reuters.com

It also marks a major offensive for CFPB director Rohit Chopra, who has pledged to watch tech-focused companies as they increasingly encroach on the traditional financial sector.

“In the United States, we’ve typically had a separation between banking and commerce, but as big tech-like business practices are adopted in payments and financial services, that separation may disappear,” he said. he told reporters.

POPULARIZED PANDEMIC BUY NOW, PAY LATER COMPANIES

BNPL services, which allow consumers to split purchase payments into installments, have exploded in popularity as Americans have turned to online shopping during the coronavirus pandemic. Providers charge online retailers a fee for each transaction.

Following an investigation last year, the CFPB found that BNPL providers Affirm Holdings, Block’s (SQ.N) Afterpay, Klarna, PayPal (PYPL.O) and Australia’s Zip Co (ZIP.AX) had issued a total of 180 million loans in 2021, totaling $24.2 billion, an annual increase of more than 200% compared to 2019. read more

The CFPB in its report, however, said it was concerned their products posed risks to consumers, pointing to a lack of standardized disclosures across the five companies surveyed and the potential for consumers to become overstretched.

In particular, the CFPB said that because BNPL’s providers do not provide data to credit reporting agencies, lenders may have an incomplete picture of a borrower’s liabilities, including BNPL’s loans to corporations. competitors.

The agency also highlighted the collection of customer data as a consumer risk and said it would begin to identify data monitoring practices that BNPL firms should avoid.

In a statement, a spokesperson for Affirm said its top priority was “to empower consumers by providing a safe, honest and responsible way to pay over time, with no late or hidden fees.”

“Today represents a major step forward for consumers and honest finance, and we are encouraged by the CFPB’s findings following their review,” the spokesperson said, noting that the CFPB report acknowledged that the BNPL imposes significantly lower costs on consumers compared to traditional credit products.

A Klarna spokesperson said the company is “committed to financial well-being and consumer protection through industry innovation and proportionate regulation.”

“We are delighted that the CFPB has recognized the value that BNPL brings to consumers, including access to credit, ease of use and lower costs, especially in difficult economic times,” a spokesperson said. by Zip.

Penny Lee, CEO of the Financial Technology Association, a trade group that represents Afterpay, Klarna, PayPal and Zip, said in a statement that the report made it clear BNPL was a competitive alternative to high-interest credit products.

“We look forward to continuing to work with regulators like the CFPB to advance positive consumer outcomes,” she said.

The CFPB was created following the 2008 financial crisis to crack down on predatory lenders, such as mortgage companies and payday lenders.

Although the agency does not traditionally oversee BNPL companies, Chopra told Reuters in July that he believed he had the power to regulate the companies’ activities when they were similar to those of traditional financial services firms.

However, BNPL companies are likely to fight this claim.

Share prices of “buy now, pay later” public companies have been under pressure this year, with Affirm down more than 75% and Zip down 79%. Klarna’s valuation fell around 85% in July. Read more

Join now for FREE unlimited access to Reuters.com

Reporting by Hannah Lang in Washington; Editing by Michelle Price, Josie Kao, Jonathan Oatis and Diane Craft

Our standards: The Thomson Reuters Trust Principles.

]]>
BBB warns against predatory payday loan companies https://stormbirds.net/bbb-warns-against-predatory-payday-loan-companies/ Mon, 12 Sep 2022 15:43:00 +0000 https://stormbirds.net/bbb-warns-against-predatory-payday-loan-companies/ WICHITA FALLS, Texas (KAUZ) — The Better Business Bureau warns of predatory payday loan companies and fraudsters who thrive among unequal laws and stolen data. Amid inflation, the COVID-19 pandemic and job losses, many consumers have turned to payday loans for short-term solutions, according to the BBB. This would have allowed predatory lenders to thrive; […]]]>

WICHITA FALLS, Texas (KAUZ) — The Better Business Bureau warns of predatory payday loan companies and fraudsters who thrive among unequal laws and stolen data.

Amid inflation, the COVID-19 pandemic and job losses, many consumers have turned to payday loans for short-term solutions, according to the BBB. This would have allowed predatory lenders to thrive; many borrowers are still struggling with exorbitant interest rates and opaque fees. It has also created a fertile environment for scammers.

The BBB has published the following highlights and observations from a study:

  • From 2019 to July 2022, the BBB received nearly 3,000 customer complaints about payday loan companies, with a disputed dollar amount of nearly $3 million.
  • The payday loan market is a mix of genuine payday loan companies and scammers – these scammers pose as payday loan lenders or collectors; online payday loan makes it harder to tell the difference
  • Although legal, some real payday loan companies may use deceptive practices with triple-digit interest rates and opaque loan fees.
  • Whether real or fake, the payday loan solution can leave consumers even more in debt, with some facing bankruptcy, eviction and despair.

BBB officials advise consumers to research all their borrowing options thoroughly before signing anything for a short-term loan. They also recommend reviewing the terms and conditions of a payday loan.

For more information on the BBB, click here.

]]>
With very high inflation, taxpayers are reconsidering their payment options https://stormbirds.net/with-very-high-inflation-taxpayers-are-reconsidering-their-payment-options/ Fri, 09 Sep 2022 08:54:40 +0000 https://stormbirds.net/with-very-high-inflation-taxpayers-are-reconsidering-their-payment-options/ Taxpayers often wonder how to repay their tax debts. But with inflation and rising interest rates, these questions are becoming more common, and the standard answers don’t always apply. To make a good decision, it is important to understand how the IRS applies interest and penalties to tax bills. Penalties Two common penalties for individual […]]]>

Taxpayers often wonder how to repay their tax debts. But with inflation and rising interest rates, these questions are becoming more common, and the standard answers don’t always apply.

To make a good decision, it is important to understand how the IRS applies interest and penalties to tax bills.

Penalties

Two common penalties for individual taxpayers are default in payment (FTP) and default in reporting (FTF). The FTP penalty is 0.5% of the unpaid taxes for each month the tax remains unpaid. The FTF penalty is much higher – 5% of unpaid taxes for each month late filing – which is why you must file even if you can’t pay what you owe. In either case, the penalty will not exceed 25% of your unpaid taxes.

A Quick Note: The IRS recently announced that they will automatically waive the FTF penalty for individual returns for the 2019 and 2020 tax years filed on or before September 30, 2022.

Importantly, the IRS charges interest on penalties.

Interest

For people who owe money to the IRS, the interest rate is calculated using the federal short-term rate plus 3 percentage points. The IRS sets and publishes interest rates quarterly for the current year and previous years. You can consult the current rates and the rates of previous years on the IRS website.

Payment Considerations

This backdrop is key to understanding your options – math matters. But I also appreciate that convenience, long-term consequences, and the ability to rest easy at night are also important in your decision-making process. Although it’s best to pay now, it’s not always realistic. Here are some general recommendations for dealing with unpaid tax bills when you can’t pay immediately. Your mileage may vary.

just say no

Empty retirement accounts. Draining your retirement accounts to pay off an unpaid debt can be tempting, and the IRS considers funds held in a retirement or profit-sharing plan to be assets available for collection. But I still maintain that draining retirement accounts should be avoided for most taxpayers.

Beyond the obvious – you’re giving up the money you’ve been counting on for your future – you’ll take an immediate hit. Withdrawals from most accounts will be taxable, so you will have to pay tax on the money you use to pay taxes and, depending on your age and circumstances, you may also be subject to an early withdrawal penalty of 10%. Certain penalty exceptions may apply, including funds used to settle an IRS levy under Section 72

]]> BBB study finds payday loan companies thrive amid uneven laws and stolen data – InsuranceNewsNet https://stormbirds.net/bbb-study-finds-payday-loan-companies-thrive-amid-uneven-laws-and-stolen-data-insurancenewsnet/ Tue, 06 Sep 2022 11:43:11 +0000 https://stormbirds.net/bbb-study-finds-payday-loan-companies-thrive-amid-uneven-laws-and-stolen-data-insurancenewsnet/
As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has […]]]>
As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions in line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has also created a fertile environment for scam artists, according to a new in-depth study from the Better Business Bureau. (BBB).

Payday loan laws are managed from state to state among the 32 states in which they are available, and a complex web of regulations makes the impact of the industry in the United States and Canada difficult to understand. follow. The BBB study, however, finds a common thread in the triple-digit interest rates that many of these loans carry – camouflaged by interest compounded weekly or monthly, rather than annually, as well as significant rollover fees.

From 2019 to July 2022, BBB received nearly 3,000 customer complaints about payday loan companies, with a disputed dollar amount of nearly $3 million. In addition, over 117,000 complaints have been filed against debt collection companies at BBB. Complainants often said they felt ill-informed about the terms of their loans. Many fall into what consumer advocates call a “debt trap” of racking up interest and fees that can force customers to pay double the amount originally borrowed. A St. Louis, Missouri woman recently told BBB that over the course of her $300 loan, she paid over $1,200 and still owed an additional $1,500.

The scammers haven’t missed an opportunity to take advantage of consumers either, with BBB Scam Tracker receiving over 7,000 reports of loan and debt collection scams representing around $4.1 million in losses. Posing as payday loan companies and debt collectors, scammers use stolen information to trick consumers into handing over banking information and cash. In one case, BBB discovered that hackers had stolen and released detailed personal and financial data for more than 200,000 consumers. Reports say this is not an isolated incident

According to a report by BBB Scam Tracker, an Alabama man went online to apply for a loan. He got all kinds of responses, saying they even took people with bad credit. Eventually, he settled on one for $5,000, but was told he had to pay $100 in gift cards first. This happened a series of times where they told him that other reasons (credit increases, etc.) were needed to approve the loan. In the end, he said he lost $8,300.

Regulators at the federal level have passed tougher laws to combat predatory lending, but those regulations have been rolled back in recent years, leaving states to set their own rules on interest rate caps and other aspects of lending. on salary. More than a dozen states introduced legislation last year to regulate payday loans, but the landscape of legally operating payday lenders remains inconsistent across states.

Currently, payday loans are not allowed in 18 states, according to Pew Chartiable Trust. In addition, the Military Loans Act sets a rate of 36% on certain payday loans. When it comes to fraudulent behavior, law enforcement is limited in what they can do to prosecute payday loan scams. Some legal payday lenders have attempted to prevent scams by educating consumers about the ways in which they will or will not contact borrowers.

The BBB study advises consumers to thoroughly research all of their borrowing options — as well as the terms of a payday loan — before signing anything for a short-term loan. The study also includes recommendations for regulators:

Cap consumer loans at 36%

Educate more people about no-cost extended repayment plans

Require lenders to test whether consumers can repay their loans

Require Zelle, Venmo, and other payment services to offer refunds for fraud

Where to report a payday loan scam or file a complaint:

● BBB.org/ScamTracker

● Federal Trade Commission (FTC) – ReportFraud.ftc.gov

● State attorneys general can often help. Find your state attorney general’s website to see if you can file online.

● If you have an overdue payment on a payday loan, the Consumer Financial Protection Bureau may have resources to help you set up a payment plan.

Source: BBB.org

Find more information about this study and other BBB scam studies at BBB.org/scamstudies. To report a scam, go to the BBB Scam Tracker. To find reputable companies, go to https://www.bbb.org.

]]>
New BBB study reveals payday scams and predatory lending https://stormbirds.net/new-bbb-study-reveals-payday-scams-and-predatory-lending/ Sun, 04 Sep 2022 17:34:58 +0000 https://stormbirds.net/new-bbb-study-reveals-payday-scams-and-predatory-lending/ FRESNO — As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions on line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – […]]]>

FRESNO — As consumers lost their jobs and struggled to make ends meet during the COVID-19 pandemic, many have turned to payday loans and other short-term solutions, with an increase in solutions on line. This has not only allowed predatory lenders to thrive – many borrowers still face exorbitant interest rates and opaque fees – but has also created a fertile environment for scam artists, according to a new in-depth study. investigative study by Better Business Bureau (BBB).

Payday loan laws are managed from state to state among the 32 states in which they are available, and a complex web of regulations makes the impact of the industry in the United States and Canada difficult to understand. follow.

The BBB study, however, finds a common thread in the triple-digit interest rates that many of these loans carry – camouflaged by interest compounded weekly or monthly, rather than annually, as well as significant rollover fees.

Image of a man holding an open wallet with nothing inside.

Image by Towfiqu Barbhuiya.

From 2019 to July 2022, BBB received more than nearly 3,000 customer complaints about payday loan companies, with a disputed dollar amount of nearly $3 million. In addition, over 117,000 complaints have been filed against debt collection companies at BBB.

Complainants often said they felt ill-informed about the terms of their loans. Many fall into what consumer advocates call a “debt trap” of racking up interest and fees that can force customers to pay double the amount originally borrowed. A St. Louis, Missouri woman recently told BBB that over the course of her $300 loan, she paid over $1,200 and still owed an additional $1,500.

Image of a hacker.

Image by B_A.

The scammers haven’t missed an opportunity to take advantage of consumers either, with BBB Scam Tracker receiving over 7,000 reports of loan and debt collection scams representing around $4.1 million in losses.

Posing as payday loan companies and debt collectors, scammers use stolen information to trick consumers into handing over banking information and cash. In one case, BBB discovered that hackers had stolen and released detailed personal and financial data for more than 200,000 consumers. The news indicate that it is not a isolated incident.

A Fon-du-Lac, Wisconsin, a woman said she recently received a phone call from a so-called debt collector stating that a lawsuit was pending against her over an overdue payday loan debt. Fearing legal trouble, she eventually sent the scammer $500 and her credit card information. Over the course of several months, her card was topped up until she canceled it.

Image of a jar full of coins that has been knocked over.

Image by Josh Appel.

Regulators at the federal level have passed tougher laws to combat predatory lending, but those regulations have been rolled back in recent years, leaving states to set their own rules on interest rate caps and other aspects of lending. on salary.

More than a dozen states introduced legislation last year to regulate payday loans, but the landscape of legally operating payday lenders remains inconsistent across states.

Image of the Pew Charitable Trusts logo. Currently, payday loans are not allowed in 18 states, according to PEW Charitable Trust. Moreover, the Military Loans Act sets a rate of 36% on certain payday loans. When it comes to fraudulent behavior, law enforcement is limited in what they can do to prosecute payday loan scams. Some legal payday lenders have attempted to prevent scams by educating consumers about the ways in which they will or will not contact borrowers.

The BBB study advises consumers to thoroughly research all of their borrowing options — as well as the terms of a payday loan — before signing anything for a short-term loan.

Image of a hand holding burning money.

Image by Jp Valery.

The study also includes recommendations for regulators:

· Cap consumer loans at 36%.

· Educate more people about no-cost extended repayment plans.

· Require lenders to check whether consumers can repay their loans.

· Require Zelle, Venmoand other payment services to offer refunds in case of fraud.

Where to report a payday loan scam or file a complaint:

· bbb.org/scamtracker

Federal Trade Commission (FTC) – reportfraud.ftc.gov

Canadian Anti-Fraud Center (CAFC) – On line or by phone at 888-495-8501

· State attorneys general can often help. Find your attorney general’s website to see if you can file on line.

· Consumer Financial Protection Bureau logo image. If you have an overdue payment on a payday loan, the Consumer Financial Protection Bureau can I have Resources to help you establish a payment plan.

Find more information about this study and other BBB scam studies at bbb.org/scamstudies.

BBB infographic on payday loan scams and predatory lending in the United States (PDF)

About the Better Business Bureau

BBB is a business-supported non-profit organization that sets and maintains high standards for fair and honest business behavior. BBB’s services to consumers are free. BBB provides objective advice, BBB company profiles on more than 5.3 million businesses, 11,000 charitable reviews, dispute resolution services, alerts and educational information on matters affecting market confidence.

Visit bbb.org for more information. There are local and independent BBBs located in the United States, Canada, and Mexico, including BBB Serving Central California & Inland Empire Counties, which was founded in 1950 and serves 11 counties in the state of California.

Watch this short BBB public service announcement video!

]]>
PayNearMe Adds Kansas, Its 20th State for iGaming and Sports Betting – Digital Transactions https://stormbirds.net/paynearme-adds-kansas-its-20th-state-for-igaming-and-sports-betting-digital-transactions/ Thu, 01 Sep 2022 15:37:33 +0000 https://stormbirds.net/paynearme-adds-kansas-its-20th-state-for-igaming-and-sports-betting-digital-transactions/ PayNearMe Inc. has added an additional statement for its iGaming and sports betting processing business. The latest expansion, in Kansas, brings the number of states in which the e-billing and payment platform provider has iGaming operations to 20. The expansion also comes as the college football and National Football League seasons begin. PayNearMe’s MoneyLine service […]]]>

PayNearMe Inc. has added an additional statement for its iGaming and sports betting processing business. The latest expansion, in Kansas, brings the number of states in which the e-billing and payment platform provider has iGaming operations to 20. The expansion also comes as the college football and National Football League seasons begin.

PayNearMe’s MoneyLine service allows operators to accept deposits into bettors’ accounts and facilitate payments. Launched in 2021, MoneyLine supports cash, credit and debit cards and automated clearing house payments, as well as alternative payment options such as PayPal and Venmo The extent of payment options supported by MoneyLine is a point of differentiation for PayNearMe in the highly competitive online gaming and sports betting market, which has attracted major processors such as Paysafe Ltd.

“Where some competitors specialize in supporting one or two forms of bidding, we support a wide range of bidding options,” said Leighton Webb, vice president and director general, iGaming and sports betting, for PaynearMe.

Another point of MoneyLine’s differentiation is its analytics capabilities, Webb adds.

To make payments more convenient, PayNearMe has developed a mobile app that facilitates cardless payments through a network of 20,000 ATMs nationwide. Punters who choose this payment option receive a unique PIN code which can be entered at the ATM. Punters must provide their mobile phone number and an order number to facilitate payment. Payouts are capped at $500. Punters can also use the app to locate an ATM near them to facilitate a payout.

PayNearMe expects the service to start rolling out in earnest in early 2023, according to Webb. Other payment methods supported by PayNearMe include push payments via ACH accounts to PayPal.

While PayNearMe refuses to disclose how much of its iGaming and sports betting business represents, Webb says that market represents “a strategic growth engine” for the company.

Since becoming a legal option in the US market in 2016, sports betting has become increasingly popular with consumers, attracting a large audience of high-income bettors in particular. TransUnion LLC’s “Consumer Pulse Online Sports Betting” study finds that 54% of mobile sports bettors earn $100,000 or more per year. Despite their high salaries, a high percentage of these bettors indicate that they struggle to pay their bills and use short-term credit services, such as payday loans, to make those payments. TransUnion conducted its research via an online survey of 2,739 adults in May.

“On the face of it, most consumers who engage in mobile sports betting can probably afford to do so,” Declan Raines, U.S. gaming manager at TransUnion, said in a prepared statement. “At the same time, our results demonstrate how important it is, especially in times of economic uncertainty, for carriers to use comprehensive data to identify both resilient and struggling consumers. This can help operators protect players and provide a safer experience for consumers engaged in regulated betting. »

]]>