VICTORIA, BC, March 27, 2012 /PRNewswire/ - Consumer Protection BC has ordered Cash Store Financial Inc., a Canadian payday lender, more commonly known as The Cash Store or Instaloans, to comply with the law and refund unlawful fees charged to their customers since late 2009.
Our 2010 investigation concluded that Cash Store Financial was charging customers more than the maximum legal amount of $23 per $100 on payday loans by charging additional fees to issue loans on cash cards. The payday lender was issued a Compliance Order in November 2010 to stop charging the unlawful fees and refund customers. Cash Store requested a reconsideration of the decision which was granted in early 2011. The reconsideration process is now complete and the key elements of the original decision have been confirmed.
"Payday loan consumers cannot be charged extra for cash cards, that is the law," said Manjit Bains, Vice President of Corporate Relations, Consumer Protection BC. "This decision sends a clear message to the industry and to consumers that consumers must never have to pay more than $23 for every $100 borrowed."
Cash Store has been ordered to comply with BC payday lending laws and refund consumers who have been overcharged since November 1, 2009. They have also been ordered to pay a $25,000 administrative penalty as well as costs incurred by Consumer Protection BC. Cash Store has satisfied Consumer Protection BC that it does not make payday loans contingent on the supply of cash cards by confirming that they are providing an option to consumers, in addition to cash cards, to receive their money in a timely manner.
Cash Store has 90 days to reimburse consumers and 120 days to provide proof of reimbursement to Consumer Protection BC. Consumer Protection BC will continue to monitor the situation to ensure that the law is being followed and consumers are refunded. Updates can be found at www.paydayloanrightsbc.ca.
A backgrounder provides additional details on payday lending in British Columbia as well as consumer tips. More information about our Reconsideration policy is also available on our website. Consumers may contact Cash Store to ask about repayment processes. Anyone with questions about payday lending in BC should contact Consumer Protection BC toll free at 1-888-564-9963 or firstname.lastname@example.org or through our social media channels.
Consumer Protection BC is a not-for-profit corporation that was created to strengthen consumer protection in BC and enforce consumer protection laws. Our vision is confident consumers and trusted businesses in a thriving marketplace. We license and inspect specific industries, respond to inquiries through our Inquiry Centre, investigate alleged violations of consumer protection laws, and educate consumers and businesses about their rights and responsibilities under the law. For more information about our organization, please visit our corporate website at www.consumerprotectionbc.ca. Follow Consumer Protection BC on Twitter @ConsumerProBC, like us on Facebook and read our blog for valuable consumer tips and resources.
SOURCE Consumer Protection BC
Image with caption: "Consumer Protection BC is a not-for-profit corporation that was created to strengthen consumer protection in BC and enforce consumer protection laws. Our vision is confident consumers and trusted businesses in a thriving marketplace. For more information about our organization, please visit our corporate website at www.consumerprotectionbc.ca. (CNW Group/Consumer Protection BC)". Image available at: http://photos.newswire.ca/images/download/20120327_C8304_PHOTO_EN_11617.jpg