Facebook Pixel Code

New York prosecutors charge payday lenders with usury

A trail of money that began with triple-digit loans to troubled New Yorkers and wound through companies owned by a former used-car salesman in Tennessee led New York prosecutors on a year-long hunt through the shadowy world of payday lending.

A trail of money that began with triple-digit loans to troubled New Yorkers and wound through companies owned by a former used-car salesman in Tennessee led New York prosecutors on a year-long hunt through the shadowy world of payday lending.

On Monday, that investigation culminated with state prosecutors in Manhattan bringing criminal charges against a dozen companies and their owner, Carey Vaughn Brown, accusing them of enabling payday loans that flouted the state?s limits on interest rates in loans to New Yorkers.

Such charges are rare. The case is a harbinger of others that may be brought to rein in payday lenders that offer quick cash, backed by borrowers? paychecks, to people desperate for money, according to several people with knowledge of the investigations. ?The exploitative practices, including exorbitant interest rates and automatic payments from borrowers? bank accounts, as charged in the indictment, are sadly typical of this industry as a whole,? Cyrus R. Vance Jr., the Manhattan district attorney, said on Monday.

Get live Share Market updates, Stock Market Quotes, and the latest India News and business news on Financial Express. Download the Financial Express App for the latest finance news.

First published on: 13-08-2014 at 23:22 IST
Market Data
Market Data
Today’s Most Popular Stories ×