Civil suit alleges Stop 'N' Cash payday loans charge excessive interest, fees

"We believe that Stop 'N' Cash has specifically targeted the most vulnerable members of society and that it has gone to great lengths to manipulate the terminology of its payday loan agreements in an attempt to mask the true nature of the criminal interest it is charging," Harvey Strosberg, lead counsel on the case, said in a statement./

National Post
March 11, 2004

Civil suit alleges Stop 'N' Cash payday loans charge excessive interest, fees

WINDSOR, Ont. (CP) - An Ontario woman has launched a civil suit against Stop 'N' Cash, claiming it charges excessively high interest and fees on the loans it provides through its franchised stores, a class-action lawyer announced Thursday.

The suit was filed by Peggy Jane Davis of Leamington, Ont., who claims to have paid effective annual interest rates well above the legal maximum of 60 per cent on dozens of payday loans obtained from a Stop 'N' Cash franchise in Windsor, Ont. The claim, which has not been tested in court, alleges that Stop 'N' Cash violates the criminal code by charging a "sham" insurance premium on top of the 48 per cent annual interest it charges.

Class-action suits have been filed by other plaintiffs against National Money Mart Co., Cash Money Cheque Cashing Inc., Unicash Franchising Inc. - all alleged to provide loans at high interest rates just below the legal limit plus additional fees.

Davis is represented by Sutts, Strosberg LLP, a Windsor, Ontario based law firm specializing in class action lawsuits. The firm also filed a suit last August against National Money Mart on behalf of Margaret Smith of Windsor.

The latest suit seeks to represent all persons who obtained payday loans from any Stop 'N' Cash store in Ontario on or after Jan. 1, 1998.

Davis seeks damages in the amount of all the payday loans advanced to the class members or, alternatively, restitution in the total amount of interest paid by the class members to Stop 'N' Cash plus $25 million in punitive damages.

A Stop 'N' Cash website says it has stores in Calgary, Abbotsford, B.C., and Saint John, N.B. But most of its locations are in about 37 cities throughout Ontario.

Stop 'N' Cash couldn't be reached for comment.

"We believe that Stop 'N' Cash has specifically targeted the most vulnerable members of society and that it has gone to great lengths to manipulate the terminology of its payday loan agreements in an attempt to mask the true nature of the criminal interest it is charging," Harvey Strosberg, lead counsel on the case, said in a statement.

Part of the claim is that Davis didn't receive a certificate of insurance for the premiums she paid and that the insurance company is not licensed in Ontario and isn't in good standing in the country of its incorporation, Barbados.

"These appear to be sham insurance premiums," Strosberg said.

© Copyright 2004 The Canadian Press


Brought to you by WikidFranchise.org

Risks: Fraud, Lawsuits, class action, Usury, Canada, 20040311 Civil suit

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License