On November 22, 2016, the Massachusetts Attorney General and the Massachusetts Division of Banks (DOB) issued a press release announcing that nearly 1,700 consumers had received refunds totaling approximately $2.3 million as a result of a settlement with an unlicensed online payday lender.

In October 2015, the DOB and Massachusetts AG filed a lawsuit against Western Sky Financial, LLC and CashCall, Inc. The complaint alleged that the companies were making illegal, high-interest payday loans over the internet. More specifically, the Massachusetts AG claimed that the companies had engaged in unfair or deceptive acts and practices in connection with making high-interest consumer installment loans “in violation of Massachusetts licensing and registration laws and with interest rates far in excess of Massachusetts’ civil and criminal usury rates of 12% and 20%.” According to the press release, the companies charged annual percentage rates between 89 and 355%.

Later that same month, the parties entered into a consent order that required the companies to cease making loans in Massachusetts. The settlement also called for the refund of approximately $2.4 million to over 1,800 borrowers for illegal interest and fees, and included loan modification relief through interest rate reductions for some borrowers. According to the press release, the total settlement will provide more than $17 million in debt relief to Massachusetts consumers. As of November 2016, approximately 93% of affected consumers had received complete refunds of their interest payments.

Massachusetts consumers who had a loan with Western Sky or CashCall and received a notice from the settlement administrator stating they are eligible for a refund may still claim the refund from the Commonwealth’s Treasurer by going online or by calling (617) 367-0400.