New York Attorney General Eric T. Schneiderman filed a lawsuit against personal loan companies for charging annual interest rates as high as 355 percent.
The lawsuit was filed Monday against Western Sky Financial, CashCall, WS Funding, and CashCall owner J. Paul Reddam and Western Sky owner Martin Webb.
The companies charged annual interest rates of 89 percent to more than 355 percent, higher than the maximum rate of 16 percent allowed for lenders not licensed by New York state…
In 2010, the three firms issued loans worth more than $38 million to New Yorkers and were owed as much as $185 million in interest and fees, more than five times the original loan amounts.
The lawsuit seeks a ban on further illegal lending, the cancellation of all outstanding loans, restitution for New Yorkers who paid above the legal limit of 16 percent and disgorgement of profits. The lenders could also face a $5,000 penalty for each violation for deceptive acts and practices.