What's my next step?

Lending of pdl is prohibited in the state of Vermont. It means all the payday lenders in your state are illegal. You are required to pay them only the principal amount as they are not licensed. If you have already paid them more than the principal amount, then ask them for the refund. Illegal lenders won???t be able to take any legal action against you. You can also request your bank manager to put a hard debit check on your bank account so that they can???t debit any money from your account in future. If you have any complaint about these lenders, then contact with the Vermont Banking Division. You may get the contact detail of Vermont Banking Division from the following link:
http://www.debtconsolidationcare.com/paydayloan/explain-pdls-laws.html

Sally, your generic posts really don't help. The OP has already stated that they've sent letters, talked to the bank, etc.

Anyway, to the OP:

Have you given copies of the ACH and wage assignment revocations to your bank and to your payroll/HR department at work? This is an important step, don't skip it.

Yes - send those complaints to the FTC and your state's AG. That's important! The BBB doesn't usually do much, you can skip that one if you like.

If they are not cooperating and are simply arguing with you, just keep sending them your illegal lender letter. I would send them copies of your AG and FTC complaints when you file them.

I suggest you also complaint to the VBD.

Vermont Banking Division
Department of Banking, Insurance, Securities & Health Care Administration, 89 Main St Drawer 20 Montpelier VT 05620
(802) 828-3307

Thanks for the response and the address. When I talked to my bank they told me to just bring in what ever correspondence I had with the companies, and that I had 2 options from there. I could pay $25 per company to block any debiting for 6 months, or I could wait to see if they tried to debit my account once they were notified. If they did then I can file a complaint and they will investigate for free and give me a "conditional refund" during their investigation. So basically, once I have revoked my authorization and they have responded to me in any way I know I'm covered there. I didn't even think to do anything with payroll department, but I will be writing that letter today also.
Again, thank you so much to everyone on this site!

Stop payments / Blocks don't always work. These people are tricky. They operate under multiple names and will hit your account with every one of them until one works. Check with your bank to see if they can change your account number for you.

Just got a response from my state! This is the letter they sent to the VIP Loan Shop on my behalf:
It has come to the attention of the Vermont Department of Banking, Insurance, Securities, and Health Care Administration (the "Department") that your company is engaged in the business of making loans to Vermont residents via the internet.

Your attention is drawn ?? 2233(b) of Title 8, Vermont Statutes Annotated, Chapter 73, Licensed Lenders (the "Act") which states that a loan solicited and made by mail, telephone or electronic means to a Vermont resident shall be subject to the provisions of the Act, notwithstanding where the loan was legally made. (emphasis added.) No person shall engage in the business of soliciting and making loans by mail, telephone or electronic means to residents of this state unless duly licensed. Such licensee shall be subject to the applicable provisions of Vermont Statutes Annotated, Title 8 and chapters 4, 59 and 61 of Title 9, but shall not be required to have or maintain a place of business in the state.
http://www.leg.state.vt.us/statutes/fullsection.cfm?Title=08&Chapter=073&Section=02233

According to the records of this Department, The VIP Loan Shop is not licensed as a lender in Vermont for any location.

Please be aware that pursuant to 8 V.S.A. ??2215:
http://www.leg.state.vt.us/statutes/fullsection.cfm?Title=08&Chapter=073&Section=02215

(a) The commissioner may:

(1) Impose an administrative penalty of not more than $10,000.00 for each violation upon any person who violates or participates in the violation of this chapter, sections 10403 and 10404 of this title or chapters 4, 59, or 61 of Title 9, or any lawful regulation, directive, or order issued thereunder; and

(2) Order any person to make restitution to any person for any violation of this chapter, sections 10403 and 10404 of this title, or chapters 4, 59, or 61 of Title 9.

(b) Each violation, or failure to comply with any directive or order of the commissioner, is a separate and distinct violation.

(c) It shall be a criminal offense, punishable by a fine of not more than $100,000.00, or not more than a year in prison, or both, for any person, after receipt of an order directing the licensee to cease exercising any duties and powers of a licensee, and assessing an administrative penalty under the authority of this chapter, to perform such duties or exercise such powers of any licensee until the penalty has been satisfied, or otherwise satisfactorily resolved between the parties, or the order is vacated by the commissioner or by a court of competent jurisdiction.

(d)(1) Any contract of loan made in knowing and willful violation of subdivision 2201(a)(1) of this title, shall be void and the lender shall have no right to collect or receive any principal, interest, or charges whatsoever; provided, however, in the case of loans made in violation of subdivision 2201(a)(1) of this title, where no finding of a knowing and willful violation is made, the lender shall have no right to collect or receive any interest or charges whatsoever, but shall have a right to collect and receive principal.

(2) In the case of any person who, after receipt of an order directing such person to cease exercising any duties and powers of a licensee, and assessing an administrative penalty under the authority of this chapter, continues to perform such duties or exercise such powers of any licensee without satisfying the penalty, or otherwise reaching a satisfactory resolution between the parties, or securing a decision vacating the order by the commissioner or by a court of competent jurisdiction, any contract of loan made by such person after receipt of such order shall be void and the lender shall have no right to collect or receive any principal, interest, or charges whatsoever.

The VIP Loan Shop is hereby requested to cease all advertising and solicitation of loans in Vermont, until they can provide evidence that they are exempt from or in compliance with Vermont statutes. Additionally, please provide a list of all Vermont borrowers that accepted a loan from The VIP Loan Shop for the period commencing January 1, 2009 to date. The list should contain the names and addresses of each borrower, the date each loan, the amount of the loan, and the amount repaid to date.

A written response is expected no later than September 2, 2011. If you have any questions, please call me at (802) 828-4878.

Sincerely,

Sue S. Clark
Regulatory & Consumer Affairs Director
State of Vermont
Department of Banking, Insurance,
Securities & Health Care Administration
89 Main Street
Montpelier, VT 05620-3101
(802) 828-4878 Fax (802) 828-1477
Sue.Clark@state.vt.us

So even after being sent all the letters from me and from the banking director, VIP Loan Shop still tried to debit $600 from me! And are still insisting that I owe them money. The only thing the Attorney General's office and the Banking Director could tell me was to close my account if I was concerned they might try to continue charging me. My account is already on a status 3 block, so no debits/checks/withdrawals can occur. I am closing it officially on Thursday when my direct deposit from work comes through. Should I worry about anything else now? Or just keep e-mailing them my letter over and over again?
Same thing with Western Sky/Cash Call. (I'd forgotten about them before). Cash Call is listed on the unlicensed lender list for my state, and they now hold my loan (The websites make it very easy to see that they are the same company with the same contact numbers, etc.). I took out a $500 loan (well, $850 with the loan origination fee), and I've made several payments to them for just over $400. I was hoping to settle with them for the other $100 to cover the money actually loaned to me, but now they are hiding behind "tribal law" and still saying I'm responsible for the whole amount. According to my state since they previously were notified that they are illegal and unlicensed in my state, they are not entitled to any principal, interest or other fees. Should I just forget about them also since my account is now closed and they aren't willing to work with me? Or should I try again?

Closing the account is always your best option. Whenever either attempts contact with you, just continue to send them the illegal lender letter.

Did you also include wage assignment revocation language? If not, you need to. And you'll need to give a copy to your HR/Payroll department so they can block any attempts at voluntary assignment.