• 07 Aug 2013 at 10:26 AM

Benjamin Lawsky: Online Lenders Are Over The Line

This is not ‘Nam. This is banking. There are rules.

Benjamin Lawsky, superintendent of the New York Department of Financial Services, has sent 35 lenders cease-and-desist orders, barring them from offering short-term, high-rate loans in the state.

“The department has uncovered dozens of out-of-state lenders who have used the Internet to solicit and provide illegal payday loans to consumers in New York,” one of the letters said. “Typically these lenders charge fees that, when annualized, result in interest rates far in excess of the legal limit.”

Mr. Lawsky’s office also sent letters to more than 100 banks, including Bank of America Corp. and J.P. Morgan Chase & Co., warning them they might be enabling the activities by allowing the lenders to deduct payments directly from a consumer’s bank account through a system called the automated clearing house network. A Bank of America spokeswoman declined to comment. J.P. Morgan couldn’t be reached for comment.

New York Scrutinizes Online Lenders [WSJ]

Comments (5)

  1. Posted by Guest | August 7, 2013 at 11:16 AM

    Shazar, as always I appreciate the value your original commentary brings to such highly interesting and relevant articles

  2. Posted by Jeffrey Lebowski | August 7, 2013 at 12:59 PM

    Shazar: My advice is to do what your parents did; get a job, sir

  3. Posted by The Shaz | August 7, 2013 at 2:48 PM

    Let me just go find a cash machine…

  4. Posted by Quant me maybe ... | August 7, 2013 at 4:35 PM

    … with 9 1/2 original words. Are you texting someone? Even instagram allows more.

  5. Posted by Kenneth | October 18, 2013 at 1:16 PM

    Mr. Lawsky’s smartness is highly admirable. I think he has been taken great decision. Although currently financial situation yet not improved. So needed control whole loan thing smartly!!