Payday lender arrested for illegal online loans, high interest rate
North Carolina Attorney General Josh Stein temporarily blocked a Florida-based financial services firm from operating in North Carolina, accusing it in a lawsuit of charging 120% to 200% interest on loans illegal online.
A Superior Court judge granted Stein’s request for a temporary restraining order against Approved Financial, which the attorney general says is not licensed to operate in the state.
The lender is contacting potential customers by email and phone, circumventing state consumer laws by forcing borrowers to travel to South Carolina to collect their money, according to a press release.
“North Carolina chased payday lenders so they couldn’t take advantage of hard-working North Carolinians,” Stein said in the statement. “We will not allow them to try to operate in our state again by circumventing the law and using online channels.”
Approved Financial has loaned funds to more than 380 people statewide, amounts ranging from $500 to $5,000. The company’s loans require borrowers to obtain loans against the titles of their cars, allowing Approved Financial to repossess customers’ vehicles with late payments.
The judge’s order restrains Approved Financial from making or collecting loans for the next 35 days, the statement said, during which time Stein’s office will seek a permanent injunction. Stein is also seeking refunds from borrowers and civil penalties against the company.
A company attorney did not immediately return an email seeking comment.
This story was originally published May 21, 2019 9:27 a.m.