Chicago, IL – November 1, 2012– 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
###
As a private, non-profit organization,
the purpose of the Better Business Bureau is to promote an ethical marketplace.
BBBs help resolve buyer/seller complaints by means of conciliation, mediation
and arbitration. BBBs also review advertising claims, online business practices
and charitable organizations. BBBs develop and issue reviews on businesses
and nonprofit organizations and encourage people to check out a company or
charity before making a purchase or donation.
