Cash America, a short-term lender with branches in Elyria and Lorain, announced today a voluntary program to fully reimburse about 14,000 Ohio customers for funds it has collected since 2008.
The company, commonly referred to as a payday lender, said that some employees did not properly prepare court documents in some of its legal proceedings that led to collection of past debts from customers.
Cash America has local locations at 505 N. Abbe Road in Elyria and 4280 Oberlin Ave. in Lorain. A company spokeswoman couldn't say for sure if Lorain County customers are effected.
According to a news release, "Cash America recently determined that a small number of employees did not prepare some court documents properly in many of its Ohio collections legal proceedings. While the Company believes the filed documents accurately depict the existence and amount of the debts owed to the Company under consumer lending contracts, the preparation and filing of these documents did not always comply with certain court rules."
Spokeswoman Yolanda Walker said all documents submitted to courts were fine but some may have been improperly notarized.
She emphasized that the company discovered the problem on its own, prompting the voluntary reimbursement, and is working with authorities.
Walker said the company is in the beginning stages of the reimbursement program and does not yet have information on what customers should do if they believe they are involved.
"As soon as we find out something, we'll come back with what these Ohio customers need to know," she said, adding that they will follow the directives of their legal team as well as any authorities.
From the company's news release:
“We hold ourselves to the highest ethical standards. When we discovered this problem, we took swift action,” said Daniel R. Feehan, CEO of Cash America. “First and foremost, we will take care of our customers and we are implementing rigorous measures to do so. We will also institute additional steps to help prevent this problem from occurring again.”
Cash America will voluntarily reimburse all amounts received through collections legal proceedings initiated by the Company in Ohio, from January 1, 2008 to the present, plus interest, including the reimbursement of amounts collected in connection with legal proceedings that were not affected by the improper document preparation. The Company is engaging an independent claims administrator to conduct the reimbursement program and to ensure the most comprehensive reimbursement possible. In addition, for all trial court collections proceedings filed in Ohio since January 1, 2008 with the exception of one appellate matter, Cash America will promptly file dismissals, terminate all existing post-judgment collections activities, and request to vacate each judgment entered and/or notify credit reporting bureaus of the vacated judgments, as necessary for each case. While Cash America is taking these actions proactively, it could still be subject to other liabilities, and additional changes in its business practices may also be required.
Read tomorrow's Chronicle for more on this story.