Sunday, June 27, 2010

Fastbucks and New Mexico Attorney General in legal scuffle

In New Mexico, the lawsuits are going like crazy between the Attorney General and loan company Fastbucks. Attorney General Gary King filed a lawsuit against Fastbucks last year. Fastbucks sued back. What's the issue? New regulations on money lenders that Fastbucks fought in court in 2006.

Resource for this article: Fastbucks and New Mexico Attorney General in legal scuffle by Personal Money Store

The original lawsuit against Fastbucks

The lawsuit that started this tete-a-tete New Mexico was filed by Gary King against Fastbucks and one other instant payday loan company. The suit scheduled for July 6th was a civil suit. The suit claimed that Fastbucks was responsible for “unconscionable” loans. The judge ordered that Fastbucks and also the New Mexico Attorney General were to attend mediation, but the Attorney General didn't show up to the session.

Fastbucks’ countersuit

In the Roswell district court, Fastbucks filed a countersuit to the Attorney General’s civil suit. Fastbucks says that the Attorney General is suing them to “create legislation with litigation.” The suit also explains the case has been filed as a reaction to the failure of the legislation to pass in 2006. There is no court date set yet. It is possible that the New Mexico Attorney General may file for the judging of the suit to be moved. As the counter suit was filed in a different district than the original suit was filed in, there may be issues of jurisdiction.

One of the most essential arguments

The arguments in the New Mexico case come down to the question of “unconscionable trade practices.” The Attorney General of New Mexico claims that these instant paydayloans charge too much money for the lending service they provide. Fastbucks and other stores that deal in quick cash loans say that they’re being unfairly targeted for providing lending to high-risk customers. Providing an instant cash is an expensive proposition, so the interest rates are high. Many states and attorney generals have taken action against these companies, saying they take unfair advantage.

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