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Online payday loan company forced out of Missouri | FOX2now.com

ST. LOUIS, MO (KTVI) – A South Dakota based online lender agrees to stop doing business with Missouri consumers. Attorney General Chris Koster is forcing the payday loan company out of Missouri.

As many as 6,300 Missouri consumers are victims. Each applied for online loans with one or more of the 8 operations run by a single individual.

Martin “Butch” Webb was doing business from a Native American reservation in South Dakota. The computer loans are short term with outragious fees and requires the consumer agree to wage garnishment if needed to ensure payback. Now, the lender must pay $270,000 in restitution and immediately stop collecting on outstanding loan payments.

Koster said Martin A. “Butch” Webb acted through numerous business entities operating from a Native American reservation in South Dakota, including Payday Financial, Western Sky Financial, Lakota Cash, Great Sky Finance, Red Stone Financial, Big Sky Cash, Lakota Cash, and Financial Solutions, none of which were licensed to do business in Missouri.

38.627003 -90.199404

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Lawmaker Attempting to Reform Payday Loans

Payday loans have many financial experts and consumer advocates concerned about people getting trapped in debt. Payday lenders have “created a business model that’s completely dependent on what they themselves say is … abuse,” according to Uriah King, vice president of the Center For Responsible Lending.

The lenders argue that their terms, such as a $19 fee to borrow $100, are cheaper than the late fees associated with credit card bills or utility bills; but over a full year, those fees can amount to rates of 500 percent or more annually. “If people were truly just taking out one or two [payday loans] a year, I don’t think this issue would be getting a lot of attention,” King said. “The average payday borrower is in (payday loan) debt a couple hundred days a year.”

Robbie Thompson, president and CEO of the Credit Union Association of the Dakotas, says many credit unions offer some of the same services as payday lenders, which may be an alternative to the risky loans. Eighteen states and the District of Columbia have banned the loans or capped their interest rates.

In South Dakota, State Rep. Steve Hickey (R-Sioux Falls) is attempting to crack down on them there. He used a coalition of backers and a poll to win approval for an initiated measure asking voters to cap interest rates to 36 percent. Lobbyists and executives approached Hickey with a proposal to support him in trying to pass less drastic regulations and reforms if he would relent on the rate ceiling, to which he agreed. Hickey said that two reforms would include a “right of rescission,” which would allow payday borrowers to change their minds shortly to get out of the loan without penalties, and a central registry of loans.

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Western Sky Loans Launches Its Cash Advance Services at New Location

WILMINGTON, DE–(Marketwire – Dec 5, 2012) – Western Sky Loans, a leading cash loan service provider, is pleased to launch its cash advance services at a new location. For years, Western Sky has been serving the ones who need quick cash by means of its efficient services. The objective of the company is to help people get instant cash advances so that they can manage any emergency situation that calls for additional money than what is available to them without having to worry about a thing.

The process of getting a loan from Western Sky is very simple. For this reason, people from all walks of life who need instant cash always put their trust in this company. The terms and conditions of this company are also very easy. It means that people with different financial needs can get their hands on the money that they need without having to worry about a thing.

Western Sky Loans offers a variety of advance cash services such as quick money, fast cash loans online, short term loans and emergency cash loans. Owing to the variety of these loan programs, it is very easy for the borrowers to get a perfect loan right according to their needs.

Residents of the U.S. who are 21 and above can apply for this loan service. There are some requirements that they must fulfill before application. They must have a checking account and must be a U.S. citizen. The residents of California, Maryland, South Dakota and West Virginia however cannot apply for Western Sky Loans.

Getting a loan from Western Sky just takes a few minutes. The applicants just need to fill out an online application form. This form is available at the website of Western Sky Loan and can be completed within minutes. As soon as the company gets their information they will get in touch with the applicants and let them know the status of their loan. The loan will be transferred into the account of the borrowers within a day.

Contact:

Grigoriy Anoshenko

Email Contact
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FTC Action Halts Allegedly Illegal Tactics of Payday Lending …

After the Federal Trade Commission filed an action in U.S. district court, a payday lender that allegedly attempted to illegally garnish consumers’ wages has agreed to stop the challenged conduct pending trial.

As part of its continuing crackdown on scams that target consumers in financial distress, the FTC complaint alleges that Payday Financial, LLC, doing business as Lakota Cash and Big Sky Cash, along with other defendants, illegally attempted to garnish consumers’ wages without obtaining a court order, to collect payments on payday loans. As a result, the defendants illegally revealed consumers’ supposed debts to their employers and deprived consumers of their right to dispute the debts or make payment arrangements, the FTC alleges.

According to the FTC, defendant Martin A. Webb operates Payday Financial, LLC, and several related businesses in Timber Lake, South Dakota. The defendants offer short-term, high-fee, unsecured payday loans of $300 to $2,525 to consumers throughout the country, advertising on television and through websites such as www.bigskycash.com and www.westernsky.com.

The FTC complaint alleges that when a consumer does not pay back a payday loan on time, the defendants send documents to his or her employer that mimic those used by federal agencies collecting debts owed to the government in an attempt to garnish the consumer’s wages. Under federal law, the government can directly require employers to garnish wages for debts it is owed without a court order. But private creditors must obtain a court order before garnishing a debtor’s wages. The complaint charges the defendants with violating the FTC Act by:

misrepresenting to employers that the defendants are legally authorized to garnish an employee’s wages, without first obtaining a court order; falsely representing to employers that the defendants have notified consumers about the pending garnishment and have given them an opportunity to dispute the debt; and unfairly disclosing the existence and the amounts of consumers’ supposed debts to employers and co-workers without the consumers’ knowledge or consent.

The complaint further alleges that the defendants have violated the FTC’s Credit Practices Rule by requiring consumers taking out payday loans to consent to have wages taken directly out of their paychecks in the event of a default, and have violated the Electronic Funds Transfer Act and Regulation E by requiring authorization for electronic payments from their bank account as a condition of obtaining payday loans.

The Commission vote authorizing the staff to file the complaint was 5-0. The FTC filed the complaint and a request for preliminary relief in the U.S. District Court for the District of South Dakota, Central Division on September 6, 2011. The complaint names as defendants Payday Financial, LLC, Great Sky Finance, LLC, Western Sky Financial, LLC, Red Stone Financial, LLC, Financial Solutions, LLC, Management Systems, LLC, 24-7 Cash Direct, LLC, Red River Ventures, LLC, High Country Ventures, LLC, and Martin Webb. On September 7, 2011, the parties agreed to a stipulated preliminary injunction to immediately halt the alleged unlawful conduct, and the court accepted and entered the stipulated preliminary injunction. The FTC would like to acknowledge the assistance of the South Dakota U.S. Attorney’s Office.

NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and
unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call
1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel,
a secure, online database available to more than 2,000 civil and criminal law enforcement
agencies in the U.S. and abroad. The FTC’s website provides free information on a variety
of consumer topics. Like the FTC on Facebook and follow us on Twitter.

(FTC File No. 1123023)
(Payday Financial NR)

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