More than $1.8 million was refunded to consumers during the 2008-09 fiscal year as the result of violations of Colorado’s consumer-lending law by some finance companies, payday lenders and mortgage companies, the Colorado Attorney General’s Office announced today.
The law regulates what are known as nonbank lenders that make or take assignment of “supervised loans” to Colorado residents and also sets maximum rates and finance charges. It also limits amounts for delinquency fees and other charges.
According to a news release from Colorado Attorney General John Suthers, most refunds were due to excessive finance charges on credit transactions.
“The size and scope of last year’s refunds underlines the effectiveness of our compliance examination program,” said Suthers. “Although individual refunds might be small in most cases, the overall results are sizable.”
Suthers said that consumers often don’t know whether the terms of their credit agreements are legal or whether payments have been correctly applied.
But he said the Consumer Credit Unit of the Colorado AG’s office periodically examines the supervised lenders for compliance with the law.
In the last fiscal year, the unit conducted compliance examinations of 610 of its 1,050 licensees.
Examination reports are confidential unless the AG’s office files a lawsuit against a lender that will not voluntarily take corrective action.
Beginning in January, the attorney general also will review the credit transactions of creditors selling goods or services on credit, known as indirect lending.
Howard Pankratz: 303-954-1939 or hpankratz@denverpost.com
