Consumer complaint received 2019-07-10
Company: LDF Holdings, LLC
State: GA
Product: Payday loan, title loan, or personal loan
Sub-product: Payday loan
Issue: Can't stop withdrawals from your bank account

Complaint:
Payday loans are ILLEGAL in Georgia and was NOT informed by this company. Here is the Georgia law : A " payday loan '' is a loan of short duration, usually two weeks, with exorbitant interest rates. The payday loan industry generates billions of dollars a year. States are cracking down on payday lenders, and the industry is regulated in the states where it is still legal. Payday loans are generally illegal in Georgia, unless made by a Georgia licensed industrial loan lender or an out-of-state FDIC insured bank as long as its agent in Georgia does not receive most of the profits. Loans made by a Georgia industrial loan licensee are subject to the terms and limitations of the Georgia Industrial Loan Act. 

Payday lenders require you to furnish a copy of your driver 's license, and information about your employment and bank accounts. The loan is usually for a couple of weeks ( the time until your next paycheck ). The lenders do not perform a credit check, and you write them a post-dated check for the amount you want to borrow plus a fee. The fee is usually a " borrowing '' fee and an account set-up fee. The lenders will then deposit your check after your payday if you have not already paid off the loan. If your bank account can not cover the amount of the loan, you will then owe the original loan plus added interest. You may also incur overdraft fees from your bank. If you know you can not pay off the loan in time, you can pay the borrowing fees ( or finance charge ) in order to renew the loan. The annual percentage rate ( APR ) for a payday loan often starts over 400 percent! This practice creates a cycle of consumer refinancing and continuous debt. 

The federal Truth in Lending Act requires disclosure of the cost of credit. You must receive, in writing, the finance charge ( a dollar amount ) and the APR, which is the cost of credit on a yearly basis. Payday lenders are subject to this regulation. 

The Georgia Industrial Loan Act of 1955 essentially made payday lending illegal by requiring state licensing and registration and by imposing strict usury limits on small loans. In 2004, the Georgia General Assembly increased the fines and criminal penalties for people making small loans at illegal rates of interest. The law went into effect in XX/XX/XXXX, and has survived challenges in federal court. Referred to as the Payday Lending Act of 2004, this law authorizes misdemeanor charges against violators, as well as fines of up to {$5000.00} per violation and a possible jail sentence of 1 year. 

Usury laws limit the interest rate amount a lender can charge. In Georgia, a licensed lender can not charge more than 10 % interest on a loan of {$3000.00} or less. Most states have a usury limit ; if you were to borrow money from an out-of-state lending institution, that states cap would apply. Bear in mind that these rates may differ from Georgias rates. 

The Georgia Department of Law 's Consumer Protection Division does not handle complaints relating to payday lenders. 

If you have questions about an industrial loan licensee, you should contact the Industrial Loan Division of the Office of the Commissioner of Insurance at : Office of the Commissioner of Insurance, Industrial Loan Division XXXX XXXX. XXXX, XXXX. , XXXX, XXXX XXXX, XXXX XXXX XXXX, Georgia XXXX Website : XXXX Phone : XXXX Georgia victims of a payday lender should pursue criminal action through their local district attorney or solicitor. Victims should also report the incident to the Office of the Commissioner of Insurance, Industrial Loan Division ( contact information above ). Please also contact the Consumer Interest Section of the Georgia Attorney General 's Office by mail to report a lender. Be aware that the Office does not take action against unlawful payday lenders on behalf of any one consumer, but acts for the benefit of the State of Georgia as a whole. As such, it can not provide consumers legal advice regarding what actions to take with unlawful lenders. The contact information is : Consumer Interest Section Office of the Attorney General XXXX XXXX XXXX, XXXX XXXX, Georgia XXXX ( Again, COMPLAINTS ACCEPTED BY MAIL ONLY ) Any victim who believes that the lender has violated the Truth in Lending Act should file a complaint with the Federal Trade Commission ( FTC ). The FTC can not solve individual problems but will be able to act if it discovers a pattern of violations. 
They are NOT licensed in Georgia NOR hold a Georgia Industrial License

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation