Thursday, January 5, 2017

Payday Lender Fined for Deceptive Ads and Collection Letters

Moneytree, a payday lender, has been fined for deceptive advertising and collection letters.   Moneytree is alleged to have misled consumers with its online ads regarding charges to cash income tax-refund checks.  Some of the ads stated 1.99, which led customers to believe it would cost $1.99, when in reality, it would cost 1.99% of the total refund.
 
Moneytree sent debt collection letters to consumers who were delinquent on their loans stating Moneytree would repossess their cars and trucks.  However, the consumers did not use their cars and trucks as collateral.  Once Moneytree realized its mistake, it sent letters telling consumers to disregard the letters, but 151 people had already made payments on their loans because of the letters.

The Consumer Financial Protection Bureau fined Moneytree $250,000 for the violations.  An additional $255,000 was charged to Moneytree for refunds to the consumers affected by these errors.

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