Collecting on an Illegal Payday

If it's an illegal lender, most likely someone in the same building is calling you claiming to be a collection agency. The federal law says (FDCPA) a collection agency has 5 days after their first initial contact with you to send a letter of collection via the mail, which must include the mini Miranda warning.
[QUOTE][LEFT]Example Mini Miranda[/LEFT]
"This is an attempt to collect a debt. Any information will be used for that purpose. If you dispute the validity of this debt you have 30 days to notify us of such" [FONT=Verdana][SIZE=2][/QUOTE][/SIZE][/FONT]

I suspect you will never receive a letter in the mail but it's something you should remind them of.

As far as "garnishing your wages", well, they can't do that without a court order, and due to the fact that they are illegal, they wouldn't dare walk into a court room, BUT, what they can do is impose a "wage assignment", which is something Internet payday lenders stick in their contracts. BUT, you can revoke it at any time, so, basically, shoot them an email and tell them you revoke their right to any and all wage assignments, send one to the original creditor, and to the collection agency, then print it out and take it into your employer.

When they call you, do not speak to them over the phone, hang up immediately, because all they want is someone to intimidate and argue with, don't give that to them. Just hang up.

Most importantly, CLICK HERE to find out how to deal with illegal lenders. Read that thread very well because it covers about everything when it comes to illegal lenders, including how to deal with wage assignments.

Thank you very your help so far Shazzers, I do appreciate it :-)
And that thread is very helpful.
Maybe I overlooked it in that thread but I didn't see any information in there regarding the fact that this collection company said that even though the loan itself was illegal since I authorized the deposit to be made into my account that they can still collect on it and that the fact that it was illegal has nothing to do with them. Is this true?
They also said that the credit union (where the deposit was made) could and would verify that I authorized this transaction. That's not true is it? Can a financial institute divulge account information to a 3rd party without my authorization? I no longer have an account there if that makes any difference.

P.S. I also forgot to ask about revoking wage assignments, I have no email address for the collection company or the original debtor. Is there another way that I can go forward with this?

can anyone answer the additional questions that I posted by chance?

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Hang in there, I am trying to answer your questions, but I am also researching some things too, so hang tight. lol

1 - Can they legally try to collect on an illegal ipdl?

No they can NOT, I explained the FDCPA law in the post above.

2 - Are they allowed by law to ask for wage garnishment/assignment on an illegal ipdl?

They can try, and probably will try, but if you follow my directions above on revoking the wage assignment, you have no worries. Send the wage assignment revocation to the original payday lender, in the letter make sure you say something like what I posted below and it should cover the "so called" collection agency also.

I hereby revoke any and all wage assignments I may have signed with your company, this includes any of your affiliates and collections. You no longer have my permission to use this wage assignment.

3 - If they happen to send the garnishment/assignment to my hr/payroll department, what can I do to ensure my paycheck isn't touched by these people?

The wage assignment revocation, you need to take a dated copy (print it out) to your payroll dept immediately.

4 - What can I say to them to get them to stop trying to collect on this illegal ipdl?

First of all, file complaints with the FTC, BBB and your attorney general's office, then follow my advice above.

My opinion is, this isn't even a REAL collection agency calling you, it's an employee of the payday lender. If they are any kind of legit collection agency, they will know that they are bound by the FDCPA ( Fair Debt Collection Practices Act), and will send you a letter of collection via the mail. NO collection agency is exempt for federal laws.

Way cool, thank you so much for all of your help Shazzers, I really do appreciate it :-)
And I apologize if I was a little impatient earlier, these people are just stressing me out.
Thank you!

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No, an illegal lender can't sue you and win. That would be like a drug dealer suing someone and winning.

Hi Shazzers, I will definitely keep you updated, thank you again for all of your help.

I received another phone call from the collection company saying that they're assuming that since they haven't heard back from me that I don't want to voluntarily take care of this so they'll have to make their final recommendation. What the heck do they mean by that?

Also, I have no email address for the collection company or the original lender, would I be covering my bases just to give the info to my hr/payroll department or is there something else that I should do?

Do you know the name of the original payday lender? Has this "collection agency" told you the name of their company?

What they mean by "final recommendation" probably isn't much. At a real CA, it usually means they're documenting refusal to pay and will escalate to litigation, if feasible. With these people, they're probably just trying to scare you into paying them :)

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Awesome, thank you Paul :-)
Also, Shazzer had mentioned earlier about issuing wage assignment revocation emails but I have no email address for the collection company or the original lender, would I be covering my bases just to give the info to my hr/payroll department or is there something else that I should do?

Fax it to them.

Here's the contact info I found:

711 S Carson Street
Carson City, NV 89701

877-287-3428 Phone
877-287-3429 Fax

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Awesome, thank you all (Shazzers, OhioGal, Paul and everyone else) for all of your help, you are tremendous people! :-)

Well, I sent the following email out so we'll see what happens, thank you again for all of your help everyone! :-) I'll keep my fingers crossed and keep you updated :-)

Date: 06-30-10

Emerald Marketing Group

(removed)
(removed)
Account # (removed)


After doing research regarding Internet payday loan laws in the State of NH, I have found that your Internet payday loans are actually illegal.
Per the NH Banking Dept:
All small loan lending with consumers located in NH requires licensure. In addition, payday and title lenders must maintain an office in the state of NH which is accessible to consumers. The penalty for not being licensed is an absolute bar to collecting any of the money leant.
I have also found the following laws to be true applying to payday loans in the State of NH in general:

Legal Status: Legal (-Low Cost)
Citation:
N.H. Rev. Stat. Ann. 399-A:1 et seq.
Loan Terms:
Maximum Loan Amount: $500
Loan Term: 7-30 days
Maximum Finance Rate and Fees: 36% annual interest
Finance Charge for 14-day $100 loan: $1.38
APR for 14-day $100 loan: 36%
Debt Limits:
Maximum Number of Outstanding Loans at One Time: One
Rollovers Permitted: None (cannot refinance, renew, extend; borrowers can renew to obtain additional cash but prior loan must be paid in full from proceeds of new loan and marked as such)
Cooling-off Period: 60 days
Repayment Plan:
Collection Limits:
Collection Fees:
Criminal Action: Prohibited
I hereby revoke any and all ACH authorizations with your company from debiting any of my personal accounts, per Federal law, Regulation E Section 205.10 Preauthorized transfers. I have closed my account with the bank to protect my interest in this matter, per instructions from The NH Department of Finance. I also revoke any and all wage assignments I may or may not have signed with your company, I no longer authorize you, your company, or your affiliates to attach any part of my wages or contact my employer for your collection purposes. I have notified my employer about this matter so any attempts to do so on your part will be rejected.

I demand that any contact be made through US Postal mail or email only. I will need everything in writing to keep accurate records of all communication as per instruction from my Attorney General's Office.
I prohibit you or your affiliates to contact me via telephone at my place of employment or my home telephone number. I also prohibit you from calling my family, friends and references listed on my loan.

Due to the fact that Internet payday loans must be licensed in the state of NH to be a legal and binding contract, your company should NOT issue loans to NH residents at all. I am requesting that you send me your license number which enables you to offer loans to NH residents.

The legal amount that could have been charged to my loan is the principal amount, even IF your Internet pay day loan were legal anywhere in the U.S.. I am willing to pay the principle amount of the loan only, however, this is only if you provide me with a physical address where I can send payments.

I must also inform you that I will be filing complaints with the Better Business Bureau, the Federal Trade Commission, and the NH Attorney General's Office.

I expect a response from your company no later than 5 days from the above date regarding this matter. This response may only come via US Postal mail or email. No telephone contact is permitted.

Sincerely,

(name removed)
CC:
Better Business Bureau
Ohio Attorney General
Federal Trade Commission