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Payday Lending

Payday lending can provide short-term access to credit, but it often comes with high rates of interest and expensive fees.

A handful of national banks essentially rented out their charters to third party payday lenders. The OCC found a number of abuses in these relationships. Of primary concern was the inability of small banks to properly oversee the third parties who were making loans in their names. Among the abuses: deceptive marketing practices, failure to secure confidential customer files, and unsafe and unsound lending. The OCC took a series of enforcement actions that eliminated these relationships from the national banking system.

01/31/2003Peoples National Bank to Pay $175,000 Civil Money Penalty and End Payday Lending Relationship with Advance America
News Release 2003-06| Consent Order - Peoples National Bank | Consent Order - Advance America
01/21/2003OCC Concludes Case Against First National Bank in Brookings Involving Payday Lending, Unsafe Merchant Processing, and Deceptive Marketing of Credit Cards
Release 2003-03 | Consent Order

Related News and Issuances
Publish DateIdentifierTitle
04/25/2013  NR 2013-69, Office of the Comptroller of the Currency Releases Guidance on Deposit Advance Products
07/24/2012  NR 2012-113, Deputy Comptroller Testifies on H.R. 6139
08/10/2009  OCC 2009-27, Other Consumer Protection Laws and Regulations: New and Revised Examination Procedures