Online payday lenders employ a wide range of unethical tactics to avoid state consumer protection laws. In California and Colorado, regulators are currently litigating instances involving various online payday lenders who argue they have tribal immunity from federal laws protecting consumers from predatory lending. For example, two payday loan companies have filed lawsuits claiming that the Consumer Financial Protection Bureau improperly classified them as “aggle” lenders when they pushed borrowers into long-term contract after they failed to demonstrate they could repay such a large debt.
Even more troubling than these class action lawsuits are the stories of many consumers who handed over their social security number in exchange for an initial credit line. Without a question, the potential damage done by allowing online paydaypaydayloansnow.co.uk lenders to collect bank account information without consumers’ knowledge is substantial. What few people realize is that such data could be used to take complete control of their bank accounts or even to obtain other forms of consumer financial information, such as tax refunds.
As the threat of identity theft becomes more real, more consumers are urged to seek out legal help to avoid being scammed or ripped off. Unfortunately, this isn’t always possible. However, taking advantage of existing laws against abusive online payday lenders by taking precautionary measures such as making sure only friends and relatives can sign their name on the loan documents is a very sensible first step. Doing so can go a long way towards ensuring that borrowers are not ripped off or left with insufficient funds to pay back the online payday lenders.