New York State Attorney General, Eric T. Schneiderman has filed a law suit against Western Sky Financial and its affiliates for violating New York rate caps.
It was found that the lender was offering short-term loans at interest rates of more than 300 per cent and the authorities are working to ensure that the low interest rates are offered in the state. Western Sky Financial and its affiliates claims that they are linked to American Indian tribes and this allows them to bypass federal and state laws.
The lender said that it operates within the exterior boundaries of the Cheyenne River Sioux Reservation in South Dakota and said that it is beyond the reach of state regulators, including Mr. Schneiderman. However, Mr. Schneiderman has filed lawsuit against the lender and affiliates in the State Supreme Court claiming that they violated state usury laws that limits the interest rates on loans at 25 per cent in the state.
He said that such pay-day lenders aim at offering illegal and deceptive schemes with high-interest, personal loans to consumers in New York. Mr. Schneiderman has said that Western Sky and its affiliates have made at least 17,970 costly loans to New York residents since 2010.
ource: Top News