Payday Loan scheme has victimized more than 300 consumers nationwide

(A Message from the Better Business Bureau)

 

 

CHICAGO, IL – Hundreds of consumers across the nation, including the Chicago area, have sent in complaints to the Better Business Bureau about an online payday loan scheme that is based in Las Vegas, Nev.   Seven businesses, all with the same Las Vegas address, have been issued warnings and given “F” ratings by the Better Business Bureau serving Las Vegas.

 

“Because numerous Chicago-area consumers have been victimized by these Las Vegas companies, the Better Business Bureau of Chicago and Northern Illinois is issuing its own warnings to consumers in our area,” explained Steve J. Bernas, president and CEO of the Chicago organization.

 

The businesses identified by the BBB are Capital Advance Capitol (also known as Loan Assistance), Ideal Advance, LoanTree Advances, Pacific Advances,Palm Loan Advances, Vantage Funding, and Your Loan Funding. All list addresses at 2780 S. Jones Blvd., Suite 3675, in Las Vegas, NV, and most have virtually identical websites.

 

More than 300 people nationally, including consumers in the Chicago area, have filed complaints against the businesses, most of them in the past several months.

 

Complainants told the BBB that the online payday loan businesses used electronic checks to take $30 from their accounts. Some consumers said the companies told them the charges were payday loan application fees, even though the consumers maintain they never formally applied for loans. Other consumers said they have no idea where the businesses got their banking information or how they were able to access their accounts.

 

“When people are in need of fast cash or in a desperate situation, they often are more willing to sign unfavorable agreements,” said Steve J. Bernas, President and CEO of the Better Business Bureau serving Chicago and Northern Illinois. “This urgency or desperation allows unscrupulous payday loan operations to take advantage of people who are already in a tight situation.”

 

Gail, a consumer from Calumet City who filed a complaint with the BBB, saw unwarranted charges on her bank account yet never received the loan. “I went online and looked up places where I could get a loan. I finally came across Capital Advance and applied. They said that they approved me for the loan but then they kept stalling me and saying that they needed more time or information. I never got the loan. Months later I started getting strange phone calls that were collection calls. They talked about taking me to court with what they said that I owed and involving the Federal Investigations Bureau. They were trying to scare me. In May they took $30 out of my bank account and claimed it was a membership or application fee. I complained and they said that they were so sorry and I would have a refund within 7-10 days. Every time I check they apologize and say it will take another 3 days.”

 

Pamela of Harvey, had a similar experience with unwarranted charges on her bank account. “I had started to fill out a loan application online but did not complete and submit it. Later I found that there had been $30 deducted from my account. I checked into it and it looked like the company put some kind some type of check through that did not require my signature. I called them and they said that they would refund the money within 7-10 days. I did not get the refund. I kept calling and asking and each time they say that they are so sorry and that it would take another 3 days. Money is tight so I check my balance online every day. Thirty dollars is not a lot of money, but it is the principle of the thing.”

 

When looking for a payday loan online the BBB recommends the following:

• Look for the red flags. Often unscrupulous online lenders do not list or make clear their location or contact information. If there is no mailing address or specific contact information, do not use the business.

• Research the lender with the BBB. Always check an online payday lender’s Business Review before you hand over any bank account information. BBB Business Reviews are available for free online. They tell you how many complaints the BBB has received, how the company responded to complaints and the BBB’s overall letter-grade rating.

• Know regulations in Illinois. Payday loans can be extremely expensive if you are unable to pay the loan off quickly, and in some states payday loans are unregulated. Under a law passed in March 21, 2011 there are more strict laws regulating payday loans in Illinois.

• Look thoroughly at the contract before signing. As with any business transaction, be sure to read all agreements, guarantees, and instructions before signing. Do not be pressured into signing an agreement before you are ready and you understand all terms and conditions.

For more consumer tips, visit www.bbb.org