Arkansas Attorney General Dustin McDaniel's office has filed a lawsuit against a collection agency that did not fully answer investigative requests regarding its practices for collecting on payday loans, according to the AG's office.
The suit against National Credit Adjusters of Hutchinson, Kan., asks a Pulaski County (Ark.) circuit judge to require the agency to respond fully to the attorney general's investigative demands and ban it from collecting from Arkansas consumers until it does so.
McDaniel noted that the collection agency revealed it is in the business of buying and attempting to collect on old payday loans taken out by Arkansas residents. He said it is his stance that because payday lending is illegal in Arkansas, debts from that type of lender are not enforceable in the state.
The AG’s office in 2008 began a concerted effort to drive payday lenders out of the state.
National Credit Adjusters officials were not available for comment. On the company's home page of its Web site, it notes it is currently working with the FBI to resolve a “Pay Day Loan Collection Scam.”
