by Sheiresa Ngo
September 17, 2013
Payday Lender Stopped by U.S. Courts and Federal Trade Commission
A U.S. district court has stopped an online payday lender that was suspected of using customers’ financial information to withdraw money from their bank accounts in increments of $30 without their permission.
The Federal Trade Commission alleged that those heading the operation, in addition to the five companies they managed, gathered consumers’ names, Social Security numbers, bank routing numbers, and bank account numbers. All of this information would be enough to grant them access to consumers’ checking accounts.
It is estimated that consumers have lost more than $5 million. According to the FTC allegations, the defendants promised to help consumers find loans. However, they withdrew money from their accounts instead.