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Oregon fines errant online short term lender

Jul 16, 2011 Todd Milner

Oregon's Department of Consumer and Business Services recently announced that it fined online lender Global Short term Loan $90,000 for violating the state's short term lending laws that cap annual rates at 36 percent. The company had been charging interest that exceeded 2,700 percent on some of its loans, in addition to debiting consumers' bank accounts for loans that had not been made or that the customer expressed a desire to cancel, KTVZ-TV reports. GPL was also cited for renewing an existing loan more than twice, charging an origination fee of more than 10 percent and not affording the state access to records of loans taken out by Oregon residents, according to the news source. "Oregon law protects consumers from paying excessive interest rates and fees for short term loans, and we will take action when lenders violate the law," said David Tatman, administrator of the Division of Finance and Corporate Securities, as quoted by the news source. In 2006 and 2007, the state's legislators passed a series of measures designed to reduce short term lending in the state that resulted in the closure of more than three-quarters of its brick-and-mortar lenders. This drove consumers looking to make credit decisions involving short term loans to borrow online, the Portland Business Journal explains.