A payday loan company has been ordered to pay $10.5 million in fines and penalties for using illegal debt collection tactics against consumers.
The Consumer Financial Protection Bureau said EZCORP used tactics that included illegal visits to consumers at their homes and workplaces, empty threats of legal action, lying about consumers’ rights, and exposing consumers to bank fees through unlawful electronic withdrawals.
The agency is ordering $7.5 million be refund to 93,000 consumers and pay $3 million in penalties.
Additionally, the company will not be allowed to collect remaining payday and installment loan debts owed by close to 130,000 consumers.
People struggling to pay their bills should not also fear harassment, humiliation, or negative employment consequences because of debt collectors,” said CFPB Director Richard Cordray
Back in July of this year, EZCORP closed all payday lending operations in the U.S. The company now is one of the country’s largest owners of pawnshops.
EZCORP said “without admitting or denying any of the facts or conclusions of law in the consent order, in the interest of settling the legacy issues, the company agreed to pay a total of $10.5 million.”
“Given our decision in July 2015 to exit all payday, installment and auto title lending activities in the United States, we believe it is in the interests of all stakeholders to bring this issue to an amicable close,” EZCORP Chief Executive Officer Stuart Grimshaw said.
The company also said it self-reported many of the claimed issues and discontinued many of the questioned practices years ago.