During his visit to West Virginia, I asked Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, Va. Payday lenders exchange cash for a postdated check and charge a fee. One company, First American Cash Advance, began opening lending offices in the state in 2001 and eventually had 11, but closed them all in mid-2006. Attorney General Darrell McGraw reached a settlement with First American last May in which the company agreed to forgive about $616,000 in defaulted loans allegedly owed by nearly 2,700 West Virginians and to pay the state $200,500. In November 2006, McGraw reached settlements with 18 Internet-based payday lenders in which they agreed to quit doing business in the state. read more

Filed in: Cash Day Advance