By Bob Sullivan
A short-term, high-cost lender (click here) that tried to collect debts by in-person visits at borrowers' homes and workplaces has ceased dealing in payday loans, and about 200,000 consumers will get refunds or debt collection relief, federal regulators said Wednesday.
Austin-based EZCORP is accused of potentially revealing details about consumers' debts to third parties during home or workplace collection attempts, a violation of federal law. The firm is also accused of simultaneously initiating electronic transfers valued at 50%, 30%, and 20% of a consumers' outstanding debt balance, causing overdrafts and other problems for borrowers.
EZCORP operates a collector of pawn shops in and around Texas, and until recently, provided high-cost, short-term, unsecured loans, including payday and installment loans, in 15 states and from more than 500 storefronts. It did this under names including "EZMONEY Payday Loans," "EZ Loan Services," "EZ Payday Advance," and "EZPAWN Payday Loans," the CFPB said.
In a consent order, the bureau ordered EZCORP to refund $7.5 million to 93,000 consumers, pay $3 million in penalties, and stop collection of remaining payday and installment loan debts owed by roughly 130,000 consumers....
