Legal Question in Credit and Debt Law in California

Everestcashadvance1.com, a Payday lender located in Nevis and who had been issued a desist and refrain order and order to disgorge by the state of California back in 2011 has continued to lend to California residents. Unaware of this, I took out a loan with them. I allowed the loan to "roll-over" a couple times, then received an email from them asking for debit card information as they were "switching to a new system" and could not access bank accounts in California anymore through the ACH system (I wouldn't give them my debit card info as this seemed suspicious - after Googling I discovered that banks here had been issued an alert by the California Department of Business Oversight about blocking illegal payday lenders). After doing a bit of research I learned from the DBO that the company is still unlicensed, and the order still stands. With this info in mind, would the contract I signed with them still be binding, or is it void, voidable, or illegal? They've sent my account to collections because of my refusal to give them debit info - and they've ignored my emails asking them for a license number (that I now know they don't have). Thanks!


Asked on 3/19/14, 1:12 pm

1 Answer from Attorneys
Charles Perry Law Offices of Charles R. Perry

Licensing of Payday lenders is covered by California Finance Code Sections 23000 et seq. The statute also allows for treble damages and injunctive relief. Punitive damages may be available, and a willful violation of the statute will void the loan. Nothing in the statute allows for the recovery of attorney's fees -- on the other hand, there might be other theories that allow you to recover those.

Ignoring collection letters is often a bad idea. You should probably talk to a plaintiff litigation lawyer who can write a letter on your behalf to stop the collections. If you believe that there are a number of people like you in the state, class-action relief may even be available. Given that the company is outside the US, however, collection on a judgment may be extremely difficult.

I suggest you start looking for an attorney at your earliest possible opportunity. This is a relatively specialized area of the law, but a good general litigator ought to be able to help you.

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Answered on 3/19/14, 1:37 pm


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