CHICAGO (Legal Newsline) – Illinois Attorney General Lisa Madigan filed five lawsuits on Tuesday against online payday lenders and a loan lead generator for allegedly offering illegal, expensive, predatory loans that trapped Illinoisans in endless debt cycles.
Madigan sued four out-of-state payday lenders, alleging VIP PDL Services LLC, Red Leaf Ventures LLC, Mountain Top Services I LLC and BD PDL Services LLC sold payday loans racked with fees that were double the amount allowed under state law. The four lenders also allegedly charged Illinoisans $30 for every $100 loaned and allowed borrowers to take out multiple loans at once, in violation of the Payday Loan Reform Act.
“These online, unlicensed predatory lenders are putting Illinois consumers into unregulated, unprotected payday loans,” Madigan said. “None of these payday lenders is complying with the consumer protection we fought for over a decade to put into place to keep borrowers from being trapped in loans with excessive interest rates and fees.”
Madigan also sued MoneyMutual LLC, an online broker that allegedly generated leads on payday loans with unlicensed lenders in violation of state law. Madigan alleged MoneyMutual was able to attract borrowers due to the profile of its celebrity spokesman, talk show host Montel Williams. Madigan also expressed concern about MoneyMutual’s data collection practices.
The five lawsuits request that the court permanently ban the defendants from the payday loan business in Illinois, require full restitution and cancel pending payday loan contracts with Illinoisans. The suits also seek to impose civil penalties for the alleged violation of the Illinois Consumer Fraud and Deceptive Business Practice Act and the Payday Loan Reform Act of 2005.
Original Story: Ill. AG sues payday lenders, MoneyMutual