New York's attorney general is joining the crackdown on online payday lenders.

Eric Schneiderman, New York's top law enforcer, filed a suit Monday against three online lenders and their owners, alleging that they violated usury laws by making loans that carry annual interest rates of between 89% and 335%. New York law caps the interest rate lenders can charge at 16%.

The three companies, Western Sky Financial, CashCall Inc. and WS Funding, are based in South Dakota and California. The companies falsely told customers in New York that because the loans were online, New York's usury laws do not apply, the suit claims. Schneiderman's office also alleges that the companies made deceptive debt collection calls in violation of state laws.

The three companies have made nearly 18,000 loans to New York borrowers totaling $38 million in principal since 2010, on which the borrowers owe more than $185 million in finance charges, the suit alleges.

The companies "charged exorbitant interest rates on their loans to scam New Yorkers out of millions of dollars," Schneiderman said in the news release. "With this case and others, my office will continue to fight to protect New Yorkers from illegal business practices and stop companies that seek to prey upon consumers facing tough economic times."

Western Sky is owned by a member of Cheyenne River Sioux Tribe, according to statements provided by the companies' attorney, Katya Jestin of the law firm Jenner & Block.

Western Sky is "confidentÂ… that we have complied with applicable laws in our business practices, and we stand behind those practices," the statement says. The company's lending practices "are governed by the laws of the Cheyenne River Sioux Tribe" and "beyond the purview of state regulation," the statement says.

In a statement, CashCall and WS Funding said, "[w]e believe that the Attorney General's suit is baseless, and we are confident that the New York courts will agree." CashCall and WS Funding are affiliated companies that buy and service loans originated by Western Sky.

New York's fight against online lenders previously has been led by the office of state's Department of Financial Services, whose superintendent, Benjamin Lawsky, last week sent cease-and-desist letters to 35 online lenders. Many are accused of skirting rate caps through affiliations with Native American tribes. Lawsky's office also ordered 117 banks to take steps to prevent the companies from automatically debiting customers' accounts.

"We're really trying to take a shock-and-awe strategy. We want to make payday lending into New York, over the Internet, as unappetizing as possible," Lawsky told American Banker last week.

The lawsuit filed by the attorney general Monday asks that the three lenders be barred from making further illegal loans and pay restitution to the borrowers affected, and that all existing loans be cancelled. They also face penalties of up to $5,000 per violation, the news release says.