A payday lender with several Spokane branches is one of two companies being fined $1.2 million in the state’s largest payday lending enforcement action.
Advance Til Payday, which is listed in the Dex directory as having four branches in Spokane and Spokane Valley, and Zippy Cash may be closed down for good unless the owners can prove that they didn’t violate state law by exceeding maximum loan limits.
The Department of Financial Institutions is accusing Advance Til Payday and Zippy Cash of exceeding the state’s $700 limit on more than 400 short-term loans, which DFI alleges were cross-over loans made to the same customers at multiple locations, a DFI news release said.
Part of the misconduct stems from a DFI investigation that found the two companies represented themselves as operating separately, when ownership is actually shared by Loren C. Gill and Daniel M. Van Gasken.
There are 27 Advance Til Payday branches in Washington and six Zippy Cash branches that are part of an industry that made $1.3 billion worth of short-term loans in Washington in 2005.
The release, sent Thursday afternoon, said DFI plans to take action that would revoke the companies’ licenses and ban Gill and Van Gasken, from doing business in Washington.
A district representative for Advance Til Payday declined to comment and provided a number for an office in Georgia, which was closed.
Deb Bortner, acting director of consumer services for DFI, said the agency alleges that customers visited multiple branches in Puyallup, Tacoma, Olympia and Lacey and obtained short-term loans totaling amounts that were much higher than state limits.
Zippy Cash allegedly loaned individuals as much as $2,100, while Advance Til Payday is accused of making loans as high as $3,450.
“I think there are problems that we see in this industry and this is one of them,” Bortner said.
The examination also uncovered that when Gill applied for his license, he did not disclose an action by Virginia’s attorney general banning him from the small loans business in 1993. In addition, Gill failed to notify the department of an assault conviction in Pierce County Superior Court on July 14, 2005, according to the release.
The companies have been ordered to stop making loans in excess of the limits.
In addition, DFI said it will require the companies to review their records and return loan fees to consumers who received loans in excess of $700, the release said. The total amount of restitution has yet to be determined.
Company representatives have been served with the legal documents and have 20 days to request a hearing, Bortner said.
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