The state of Illinois on Thursday revoked the license of a Marion payday lender in a dispute over an unanswered subpoena and the arrest of a borrower.
The state’s Department of Financial and Professional Regulation canceled the license of Marion Quick Cash Inc.
The dispute began in 2010 with a complaint from a customer who claimed to have been arrested for failing to make a payment on a $300 loan from Marion. The borrower, who wasn’t named in the state’s revocation order, said he was released on $300 bail, and the money was turned over to Marion Quick Cash.
The state issued a subpoena for Quick Cash records, asserting investigators’ belief that other customers had also been arrested. Quick Cash never supplied the documents, the department asserts, and so its license was revoked.
Controversy over the arrest of payday debtors led to a change in Illinois law in 2012. Such arrests take place after the lender gets a court judgment, then summons the debtor to court for questioning about the debtors’ savings and employment.
If the debtor fails to appear, the court would issue an arrest order.
Consumer advocates claimed that debtors are summoned repeatedly until they fail to appear, and that courts usually turn bail money over to the payday lenders. In some cases, debtors had never received the summons, advocates said.
Under a reform passed in 2012, debtors who miss one court date are given a second chance before being arrested, and creditor can’t repeatedly summon a debtor unless they have evidence that the debtors’ circumstances changed.
Marion Quick Cash did not respond to a request for comment on the revocation.