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Payday lenders ordered to pay $7.5M restitution

September 18, 2012 12:00:00 AM PDT
Two California lenders have been ordered to pay $7.5 million to customers who were charged up to 400 percent on payday loans, in violation of state law.

City officials from Los Angeles and San Francisco announced the settlement of a lawsuit against payday lenders Money Mart and Loan Mart.

Customers who financed loans between 2005 and 2007 may be entitled to restitution in amounts ranging from $20 to $1,800.

"The reason people came here is this was probably the place of last resort for them," said Garcetti. "They're living from paycheck to paycheck already, and they're getting further driven down into a financial hole because of the illegal policies here."

Garcetti says the lenders violated state law by charging well over the maximum 36 percent interest rate allowed by the state.


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