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Another PayDay Lender Found Guilty In FTC "Truth In Lending" Crackdown

In yet another case of crackdown on payday lenders, the Federal Trade Commission (FTC) has won against AMG services for deceiving consumers by imposing hidden charges and inflated fees on loan amounts.

The ruling came after US District Judge Gloria M. Navarro found many cases where the defendant was charging the consumers almost triple the borrowing amount by imposing hidden charges and inflated fees, according to the FTC website.

In 2012, the FTC sued AMG services for violating the Truth in Lending Act by providing inaccurate loan information to borrowers and the Electronic Fund Transfer Act by requiring consumers to preauthorize electronic withdrawals from their bank accounts as a condition of obtaining credit, according to the FTC.

Navarro found key portions of loan documents “convoluted,” “hidden,” and “scattered.”  The court also found that AMG employees were “instructed to conceal how the loan repayment plans worked in order to keep potential borrowers in the dark.” The defendant was found to have used deceptive loan documents for over five million consumer loans.

In a partial settlement, AMG services has been barred from using threats of arrest and lawsuits for collecting debt from consumers, and from requiring borrowers to agree in advance to e-withdrawals from their bank accounts to obtain credit, according to the FTC website.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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