Let me make it clear about Goleta Will Quit Payday Loan Biz in OCC Pact

Let me make it clear about Goleta Will Quit Payday Loan Biz in OCC Pact

A Dumpster-diving excursion in Virginia has led to the breakup of a controversial partnership between a nationwide bank and a lender that is payday.

Any office of this Comptroller associated with Currency said Tuesday that Goleta nationwide Bank in Ca had decided to end by Dec. 31 its 2-year-old partnership with Ace Cash Express Inc., an Irving, Tex., payday lender. The contract spared Goleta the risk of disciplinary action; the OCC has made no secret of national banks to its displeasure’ “renting” their charters to payday loan providers. [See OCC News Release Annoucing Agreement]

The pact came into being 8 weeks after having a passerby interested in bins discovered 641 client loan files in a trash container behind an Ace workplace in Portsmouth, Va. Comptroller John D. Hawke Jr. said the discarded files, which represented loans continued Goleta’s books, exemplified the hazards banking institutions face whenever partnering with third-party payday-lenders.

“Ace’s inability to guard the files of clients whose loans were brokered at Goleta show exactly how high-risk those relationships could be,” Mr. Hawke stated. “If those files had dropped to the incorrect arms, the privacy of clients would have been seriously compromised and also the bank could have faced significant reputation and appropriate dangers.”

Although the OCC insists it isn’t in opposition to banking institutions making pay day loans, it offers over over and over over and over repeatedly relocated to quash partnerships between nationwide banking institutions and payday lenders.

OCC spokesman Robert Garsson stated the agency items to letting payday loan providers utilize the bank that is national in order to make payday loans nationwide. “we have never ever said payday lending it self is wrong,” Mr. Continue reading “Let me make it clear about Goleta Will Quit Payday Loan Biz in OCC Pact”