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Governor Andrew M. Cuomo announced brand new efforts to stop the processing of unlawful payday advances through debit card transactions and help protect ny consumers. MasterCard and Visa have actually agreed in conversations aided by the Department of Financial Services (DFS) to just take a few actions to aid stop this unlawful task over their debit card sites. A continuing, substantial DFS research has uncovered that — as regulatory force mounts on online payday lenders’ punishment associated with the Automated Clearing House (ACH) bank re payments system — some loan providers are rather utilizing debit card transactions as a conclusion run around that system to illegally deduct funds from New Yorkers’ bank records.
Benjamin M. Lawsky, Superintendent of Financial Services, also today sent cease-and-desist letters to 20 extra businesses that DFS’ ongoing research has defined as illegally marketing, making, or collecting on payday advances to ny customers — 12 of which be seemingly by using this brand new debit card strategy. With today’s action, DFS has delivered cease and desist letters to 55 online pay day loan businesses. Formerly, in August 2013, DFS delivered cease-and-desist letters to 35 online payday lenders providing unlawful loans to New Yorkers — nearly all which may have stopped lending in nyc after those letters.