Anyone with actual experience defaulting on PA payday loan?

I guess I should start with the basics: I have one PDA loan -- paradisecaseadvance.com for $400, which I've already paid over that in interest alone.

I've scoured the internet and talked to PA Banking Department, and have yet to figure out if this is a legitimate loan. One woman at Banking was brusque and pretty much said "tough luck." The man I talked to was much more interesting and said the loan wasn't legal, and that internet payday loans are exactly the business Pennsylvania is trying to drive from the commonwealth. He advised closing my checking account immediately and sending him a copy of the contract.

Since I'm not in a position to repay the loan for a little while, I took the man's advice and closed my checking account. I know Paradise (ha!) is going to give me a rough time... I'm just wondering just how rough. Does anybody here have any experience with them or Pennsylvania loans in general?

The other oproblem I'm having is figuring out just what the law is in PA. In theory, payday loans are illegal, but I've found looking through the internet that state laws appear to be meaningless. They may shut down the storefronts, but thre's always some internet lender who guarantees they can find a loophole in any state law (even the military law).

Have they really found loopholes, or are they just operating illegally and willing to take their chances with naive consumers or relaxed regulators? Seriously, how much does a loan service in the Carribean have to worry about a US regulator?

Thanks for any input.