CUOMO MANAGEMENT TAKES ACTION TO PREVENT PROHIBITED, ON LINE PAYDAY LENDING THROUGH DEBIT CARD NETWORKS

CUOMO MANAGEMENT TAKES ACTION TO PREVENT PROHIBITED, ON LINE PAYDAY LENDING THROUGH DEBIT CARD NETWORKS

Superintendent Lawsky Sends Cease-and-Desist Letters to Alternative On Line Payday Lenders Illegally Lending in Nyc

Governor Andrew M. Cuomo announced brand new efforts to stop the processing of unlawful payday loans through debit card transactions and assistance protect ny customers. MasterCard and Visa have actually agreed in talks utilizing the Department of Financial Services (DFS) to just simply take a number of actions to greatly help stop this activity that is illegal their debit card sites. A continuous, substantial DFS investigation has uncovered that – as regulatory force mounts on online payday lenders’ abuse for the Automated Clearing House (ACH) bank payments system – some loan providers are alternatively utilizing debit card transactions as a conclusion run around that system to illegally subtract funds from New Yorkers’ bank records.

Benjamin M. Lawsky, Superintendent of Financial Services, also today sent cease-and-desist letters to 20 extra organizations that DFS’ ongoing research has recognized as illegally marketing, making, or collecting on pay day loans to ny consumers – 12 of which look like making use of this brand new debit card strategy.