Payday loan company ordered to pay back $40k in fees
But are penalties enough to dissuade illegal behaviour?
Payday loan company Cashco PDL is refunding $43,885 to 370 borrowers after a Consumer Protection B.C. investigation found they violated borrowers' rights.
Cashco is headquartered in Edmonton, but has locations throughout Northern B.C. and is accessible online as well.
Consumer Protection B.C. vice president of regulatory services Shahid Noorani says the company contravened a number of regulations, including charging for cash cards and overcharging for having insufficient funds.
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"Cashco was charging consumers a $10 fee for the cash card and applying that onto the loan," he told On The Coasthost Stephen Quinn.
"We've ordered the $10 to come back to the borrowers along with the cost of borrowing and any other fees associated with the loan."
Cashco is also on the hook for $5,000 to pay Consumer Protection B.C. for partial investigation costs.
When asked if the penalty Cashco was ordered to pay is enough of a deterrent, Noorani said the penalty was a loss for the company.
When asked why payday loans continue to break the law — Cash Store was penalized $1 million in 2014 — he surmised some businesses might see it as the cost of doing business, but complaints from consumers are rare.
"We're always supportive of efforts to assess improvements to consumer protection laws," he said. "My understanding is that government staff are working towards a review of the province's payday lending law."
Noorani added he does not know about the timing or scope of any review of the law.
With files from CBC Radio One's On The Coast
To hear the full story, click the audio labelled: Payday lender Cashco ordered to pay back $40k in fees