San Francisco city officials are looking for victims of predatory payday loans to divide up to $7.5 million in reimbursements.
San Francisco City Attorney Dennis Herrera and City Treasurer Jose Cisneros spoke in front of a Money Mart at Market and Seventh streets late this morning to spread the word about the settlement of a lawsuit filed by the city against Money Mart and Loan Mart in 2007.
Borrowers receiving payday loans at Money Mart and Loan Mart, and Check N Go–which is part of a separate lawsuit with the city–were charged with what the lawsuit called “exorbitant” and “excessive” interest rates, some at 400 percent APR, or annual percentage rate.
Those victims are now eligible for anywhere between $20 and $1,800 repayment for interest, fines and fees–but the city needs to first reach claimants.
As part of the settlement the city has a three-month period to find claimants. An Oct. 1 deadline will determine how many claimants will receive a portion of the settlement, which can reach up to $7.5 million.
Money Mart and Loan Mart will pay an additional $875,000 to the city.
“It’s incredibly important we get the word out,” Herrera said this morning, as the city works to track down as many eligible citizens as possible.
Cisneros said victims “will get money they were literally ripped off for,” urging citizens to look into city-backed options such as Bank on San Francisco and Payday Plus, “so they don’t get ripped off by these type of institutions.”
As many as 10 branches of Money Mart and Loan Mart are listed in San Francisco, and Herrera said the city has the second highest density of payday lender facilities behind Seattle.
Herrera emphasized the city is working with the labor and faith community to protect “our most vulnerable citizens and residents” who fell prey to quick money advances.
Michael Pappas with the San Francisco Interfaith Council said, “it’s a cold morning in San Francisco but it’s colder for victims of predatory lenders” and vowed to inform congregations and faith programs about the restitution available.
San Francisco Labor Council Executive Director Tim Paulson expressed his thanks for city efforts to repay citizens, who are often from the low-income working class, and said the council wants to “make sure people’s checks go to the pockets of the workers,” not money lenders.
Anyone who obtained short-term loans from San Francisco-based Money Marts and Loan Marts between 2005 and 2007 are eligible for funds and can complete a claim form at sfcityattorney.org.
Sasha Lekach, Bay City News