California residents who paid exorbitant interest rates for online installation loans may be eligible for repayment over the next three months in a refund drive announced by San Francisco City Attorney Dennis Herrera.
Consumers who dealt with Cincinnati-based Check ‘n Go are eligible for restitution under a June settlement with Herrera’s office in which the payday loan company agreed to pay $4.3 million in refunds.
Herrera said Check ‘n Go partnered with an out-of-state bank in an illicit scheme to skirt California’s maximum interest rate of 36 percent for the payday loans and made loans with interest rates as high as 400 percent.
Herrera said there are thousands of victims statewide, many who are “the working poor, who are living paycheck to paycheck.”
Because of the exorbitant rates, “people could never get their principal paid down … and the number continued to grow,” he said.
The city attorney’s office is coordinating a statewide outreach effort to notify customers who are eligible for refunds, which must be claimed during a three-month period between Friday and March 28.
Herrera said San Francisco has one of California’s highest density of payday loan companies and that he will be traveling to other hot spots around the state, including Los Angeles and the Central Valley.
A refund drive earlier this year for a similar settlement with the payday lender Money Mart/Loan Mart netted more than 8,100 claimants who received an average of nearly $700.
As part of that outreach, Herrera’s office created a video with the popular song “Call Me Maybe” to encourage claimants to come forward, and he did not rule out similar efforts in this case.
“However we need to get the word out, we’re going to do it,” Herrera said.
“That was very successful in what it was intended to do,” he said, noting his office received a spike in claimants after the video’s release.
Check ‘n Go claimants may qualify for restitution if they received an online four-month installation loan between November 2006 and June 2008 through the websites checkngo.com, ilp.fbdel.com or commandloans.com.
The refunds will range from $20 to $4,675, depending on the size of the payment by the claimant.
People are encouraged to visit caloanrefund.org, email email@example.com or call toll-free to (855) 581-2350 for more information about how to make a claim.
Dan McMenamin, Bay City News