By Mark Huffman
ConsumerAffairs.Com
July 26, 2010
FFD Companies uses the Internet to market its payday loans to consumers across the country, including to at least 576 consumers in West Virginia.
But West Virginia sued the payday lender, accusing it of violating state law that keeps payday lenders out. In a settlement with West Virginia Attorney General Darrell McGraw, FFD will pay refunds totaling $305,446.53 to 576 affected West Virginia consumers and has promised not to do business in the state.
"Payday loans are not solutions but treacherous traps that can lead to financial ruin for the many West Virginians facing difficult financial circumstances," said McGraw. "We will not rest until all payday lenders agree, as the FFD Companies have now done, to stop marketing these predatory payday loans over the Internet to West Virginia consumers."
West Virginia is one of a handful of states that have outlawed payday loans by imposing an interest rate cap on loans. Payday loans are high-interest loans or cash advances with interest rates that reach as high as 600 to 800 percent APR. The loans, typically made for 14 days, are secured by a post-dated check or an agreement authorizing electronic debits from the consumer's checking account.
Earlier charges
McGraw sued FFD Companies in November 2009, charging the defendants had engaged in the making and collection of Internet payday loans in violation of West Virginia law. Since McGraw began investigating the industry in 2005, he said his office has reached settlements with 107 Internet payday lenders and their collection agencies, resulting in $2,452,978.87 in refunds and canceled debts for 8044 West Virginians.
As negotiated by the Attorney General's Consumer Division, the settlement involves eight corporations under the FFD umbrella and their principals, with offices in Delaware, Georgia, New Mexico, Nevada, Texas, and Utah. The FFD Companies and websites that entered into the agreement include: FFD Ventures, LP of Carson City, NV, and Atlanta, GA; DFD Ventures, LP of Carson City; First Fidelity, Inc. of Carson City, Wilmington, DE, and Atlanta; FFD Resources I d/b/a Cash Supply of Espanola, NM, and Atlanta; FFD Resources II, LLC d/b/a Web Payday of Atlanta; FFD Resources III, LLC d/b/a Payday Services of Salt Lake City, UT, and Atlanta; FFD Resources IV, LLC d/b/a Payday Yes of Wilmington; FFD Resources IV, LLC d/b/a Paper Check Payday of Wilmington; and Great American Credit Management of Atlanta and Houston, TX.
