Minnesota D.A. goes after unlicensed Internet lenders

Minnesota allows payday lending. They have a goofy fee structure:

$5.50: $0-$50; 10%+$5: $51-$100; 7% (min. $10) + $5: $101-$250; 6% (min. $17.50) + $5: $251-$350 (After default: 2.75% per month)

In 2009, they required Internet lenders to be licensed in the state. The DA is going after the following lenders: East Side Lenders of Delaware, Global Payday Loan of Utah and Jelly Roll Financial of Virginia b/c they’re not licensed and they’re charging more than the state allows.

We see these Internet lending law suites popping up more and more. Recently, we had an article titled “To get licensed or not to get licensed? That is the question.” I get this question a lot from people trying to get into the business.

Now, I know that every lender has their own defense like, “We’re not doing loans in XXXX.  We’re doing loans in Delaware.”  That’s not really the point.  My opinion is that no amount of money is worth the aggravation of criminal charges.  Also, how do you sell an illegal operation?

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