Category: Uncategorized


Payday Loans: State Bank Regulators Upset with Feds

Kevin Wack, with American Banker, wrote an interesting piece regarding state bank regulator uneasiness with the Fed’s interference in the payday loan industry.

Kevin quotes Margaret Liu, senior vice president at the Conference of State Bank Supervisors: “It is one thing to be ensuring that a business partner, the client of a bank, is operating legally,” she said. But a line is crossed when a payday lender “is being denied banking services because of concern about a federal agency advancing its own policy agenda, beyond appropriate supervisory responsibilities.”

Here’s a link to Kevin’s piece: American Banker (Subscription Required) Also on RepubHub

To have these timely Posts delivered to your inbox, sign up below. Spam is for jerks! We are not jerks!!

Enter your email address:Delivered by FeedBurner

Tribe Payday Loans: $968M FTC Fine

“Debt collectors cannot garnish consumers’ wages without a court order, and they cannot sue consumers in a tribal court that doesn’t have jurisdiction over their cases,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Regardless of tribal affiliation, debt collectors must comply with federal law.”

Webb and his companies, under terms of the settlement, agreed to a $550,000 civil penalty for violating the Credit Practices Rule, which prohibits payday lenders from requiring borrowers to consent to have wages taken directly out of their paychecks in the event of a default. The defendants surrendered $417,740 stemming from their prior practice of attempting to garnish consumers’ wages without court orders, according to a partial judgment in favor of the FTC in September 2013.

Along with the monetary payment imposed on the defendants, the settlement bans… Read More


$727M Fine by B of A: Deceptive Marketing


Millions of Consumers Harmed by Bank’s Deceptive Marketing and Unfair Credit Card Billing Practices

WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) has ordered Bank of America, N.A. and FIA Card Services, N.A. to provide an estimated $727 million in relief to consumers harmed by practices related to credit card add-on products. Roughly 1.4 million consumers were affected by Bank of America’s deceptive marketing of their add-on products. Bank of America also illegally charged approximately 1.9 million consumer accounts for credit monitoring and credit reporting services that they were not receiving. Bank of America will pay a $20 million civil money penalty Continue Reading..


PDL Four Oaks Bank Resurfaces

Four Oaks Bank in North Carolina issued a press release today announcing their “stock sale will provide Four Oaks with a shot of much-needed capital. It is operating under a May 2011 agreement with the Federal Reserve Board that requires it to meet certain capital requirements. The company has struggled to find investors and it was a target the Justice Department’s “Operation Choke Point” probe, which investigates banks’ ties to payday lenders. Four Oaks reached a $1.2 million settlement with the Justice Department in January, helping to dispel its troubled aura.”

Here’s a link to the Press Release.

To have these timely Posts delivered to your inbox, sign up below. Spam is for jerks! We are not jerks!!

Enter your email address:Delivered by FeedBurner

Payday Loan Industry: Tactics, Strategy, Consolidation & DFC Global

'Hot News' photo (c) 2010, Keith Ramsey - license:! No more listening in on DFC earnings conference calls 🙁

To: All DFC Employees
From: Jeff Weiss, Chairman and CEO
Date: April 2, 2014
Subject: Exciting News about our Future

Dear Team Members:

I want to let you know about an exciting new chapter in our company’s history.

We have entered into an agreement to be acquired by Lone Star Funds, a global private equity firm based in Texas. This agreement is an important endorsement of our company as a valued investment, and will help us better secure our future as an industry leader in the financial services market.

As a result of the transaction, which we expect to be completed in the third calendar quarter of 2014, we will once again become a private company, and will no longer be traded on the NASDAQ. As you many of you may remember, we were a privately held company prior to going public in 2005.

Lone Star has extensive experience in the financial services and retail sectors, and has an excellent history of working with companies and their management teams to help them achieve outstanding operating and financial objectives. With their commitment, we believe we can accelerate our plans to grow our business, resulting in enhanced opportunities for all of us and our customers.

We are at the early stages of this transaction and there is still a lot of work ahead of us. In particular, over the coming months we will be seeking approvals from both our regulatory agencies and shareholders. In parallel to those efforts, members of DFC will be working alongside representatives of Lone Star to plan our strategy for after we close the transaction. We want to be ready to hit the ground running on day one, and we will provide you with updates on those plans and our future activities as we reach key milestones.

Naturally, you will want to know how today’s announcement impacts you. First, until the transaction closes, we will continue to operate as an independent company. While there will ultimately be a change in the equity ownership of our company, it will have little effect on our business operations or on your day-to-day responsibilities. Lone Star agrees with us that our people are among our most valuable assets and recognizes that each of you have been a driving force behind our success.

I want every one of you to know how much we value and appreciate the important contributions you make every day. It is your diligence that has been the foundation for our achievements over the last 30 years.

I encourage all of you to remain focused on continuing to provide the same convenience, accessibility and high quality service that our global customer base has come to expect from us.

Today’s announcement may lead to increased interest from the media and other third parties. It is crucial that we speak with one voice and that you not directly respond to any external inquiries. Please direct all media or third party inquiries to our external communications partner, ICR, via either Garrett Edson or Phil Denning .


Jeff Weiss Chairman and Chief Executive Officer

Lone Star Fund VIII (U.S.), L.P. has committed to capitalize Parent, at or prior to the Closing, with an aggregate equity contribution in an amount of $750,000,000 on the terms and subject to the conditions set forth in the equity commitment letter dated April 1, 2014 (the “ Equity Commitment Letter ”).

Pursuant to the debt commitment, Jefferies Finance LLC and jointly, Credit Suisse AG and Credit Suisse Securities (USA) LLC (the “ Lenders ”) have committed to provide, on a several basis, 60% and 40%, respectively, of (i) a $125,000,000 senior secured, asset-based revolving credit facility and (ii) to the extent that all or any portion of the $750,000,000 senior secured notes contemplated by the Debt Commitment Letter are not issued on or prior to the Effective Time, a senior secured bridge facility in an aggregate principal amount of up to $750,000,000, on the terms and subject to the conditions set forth in a debt commitment letter entered into by the Lenders in connection with the Merger (the “ Debt Commitment Letter ”).

Payday loan fans, expect to see a lot more consolidation in our industry! The heat is on, new competitors are entering (often funded by Silicon Valley), and the current regulatory environment is driving this momentum. Here’s a link to the DFC Global SEC Filings

To have these timely Posts delivered to your inbox, sign up below. Spam is for jerks! We are not jerks!!

Enter your email address:Delivered by FeedBurner