Consumer Alert by the BBB on American Web Loans During a BBB investigation of this business, BBB contacted a representative from the Oklahoma Department of Consumer Credit to gather more information on American Webloan and payday lending company licensing rules and regulations for the state of Oklahoma. BBB verified that American Web Loan does not possess a deferred deposit lender license. BBB was informed that all payday lending companies are required to carry a license in order to operate their business; however, if the company is owned by a Native American Tribe they are not obligated to follow the state laws. The Department of Consumer Credit does send out notifications to the companies regarding licensing; however, the companies generally respond by saying they are their own sovereign nation and, therefore, do not need the license. After reviewing the companys website BBB found the following statement: Please be advised that you are accepting the terms of your loan subject to the Otoe-Missouria Tribe American Web Loan Act and under the authority of the Finance Services Regulatory Commission established under the Act*** BBB encourages all consumers seeking loans of any kind to research all of their options before providing any private financial information or signing any loan papers. Consumers should check with BBB on the companys grade, their complaint volume, and whether or not the company is licensed or regulated to provide the type of loan services the customer is seeking. Consumer complaints received by BBB allege: billing and collection issues, refund issues, concerns with sales practices, and unsatisfactory customer service. The majority of the complaints pertain to confusion regarding the terms and conditions of the loan as well as the consumers obligation to repay. This uncertainty subsequently creates late payments, defaulted loans, or calls to customer service in order to obtain clarification. Moreover, many consumers allege unauthorized automatic withdrawals of payments from checking accounts; or when the loan has been paid in its entirety consumers allege the continuation of unauthorized automatic withdrawals from checking accounts. Often, the business collection efforts result in contacting complainants references inappropriately, inappropriate voice-mail messages, or verbal misrepresentations. Many consumers overpay resulting in requests for refunds. Although these requests are met with compliance, the long delay and subsequent breakdown in communication from the business results in consumer complaints filed with BBB. Consumer complaints also reveal a pattern of issues regarding sales practices: many complainants allege verbal misrepresentations regarding the terms of the loan, prior to the consumer actually agreeing to the loan. Generally, after the loan is received previously undisclosed charges and/or payments are automatically withdrawn out of the complainants account, which often result in negative balances and/or overdraft fees. Complainants also allege exorbitant interest rates that sales representatives neglect to disclose; and/or neglect to explain how payments will be applied towards the loan in regards to principal or interest. BBB contacted this company concerning its pattern of complaints on September 11th 2013 and again on November 7th 2013. BBB asked the company to address the concerns BBB outlined and also provide steps the company will take in order to prevent future complaints of the same nature. The business has not responded to BBB concerning these matters. Better Business Bureau
Posted on: Fri, 14 Nov 2014 22:02:38 +0000
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