California Check Cashing Stores agrees to $900K Settlement over Interest Rate Cap Avoidance

The California Department of Business Oversight (DBO) found that California Check Cashing Stores (CCCS) willfully misled and deceived borrowers to evade the California Financing Law (CFL) interest rate cap.

This settlement requires that CCCS pays $105,000 in costs and penalties and refunds approximately $800,000 for consumer loans and payday loan transactions. Consumers who believe they may qualify for a refund should contact the CCCS. California Check Cashing Stores is a subsidiary of Direct Financial Solutions, LLC, which is owned by Community Choice Financial, Inc.

An examination of CCCS under the CFL from 2014 and its payday-lending business from 2012-2017 indicated borrowers were overcharged interest rates with administrative fees to avoid interest rate caps of the CFL. The CCCS also used advertisements claims that misled and deceived consumers by stating it made loans of “up to $5,000,” but in reality, the minimum amount offered was $2,501.00. DBO Commissioner Jan Lynn Owen describes CCCS motives as “steering consumers into higher-cost loans to circumvent statutory interest rate caps is abusive.”

Read the full press release at: http://www.dbo.ca.gov/Press/press_releases/2019/CCCS-press-release-FINAL-1-22-19.asp.

Spread the word. Share this post!