BBB is alerting Maryland consumers of a Las Vegas company Funds Direct, who, according to a pattern of complaints, debits consumer’s accounts for $30 without their authorization.
Some consumers report that due to the debits, they were charged account overdraft fees and in some cases, were forced to close their accounts.
“I’ve never had any contact with Funds Direct, and hadn’t even heard of them until they took $30 out of my account causing an overdraft,” stated a Florida consumer. “I was told that my account would be refunded within 7-10 business days. It’s been over a month and I still haven’t received a refund.”
Although the company’s terms and conditions state “If you feel that for any reason you are not completely satisfied with our services we offer a no question 30-day money back guarantee,” some consumers report not receiving promised refunds. The company’s website guarantees “instant” and “fast cash,” however, the information cannot be accessed until a password and email address are given through an unsecure site.
BBB called the company representing a consumer who was charged the $30 membership fee, and was directed to a call center. They refused to give us the company’s actual physical location, refused to let us talk to a supervisor, and refused to tell us from where they received the consumer’s debit account information. The telemarketer we spoke with confirmed he was not located in Las Vegas and that he answered phone calls for a variety of similar companies. After persistently asking the same questions, the telemarketer finally told us he’d transfer us to his supervisor, at which point, he hung up.
The company has responded to some BBB complaints with a form letter stating refunds have been given for the withdrawals as well as the overdraft fees. Some consumers report never receiving the promised refunds.
BBB reminds consumers seeking loans (particularly short-term or bridge loans) to consider the following:
- Maryland has two specific regulations designed to protect consumers when applying for loans; (a) small loan rate cap is 2.75% per month and 33% per year and (b) it is illegal to require upfront fees when applying for a loan (except for incidental costs such as credit report). While the cap dissuades the payday loan sharks of other states whose APR (Delaware) may be as high as 300%, the online lending sharks continue to swarm.
- Under the Truth in Lending Act, the cost of the loan must be fully disclosed and the customer must receive in writing the finance charge and the annual percentage. Consumers are advised to find out specifically additional charges such as late charges. Individuals with bad credit or credit risks are easy targets and while they may be charged a higher interest rate, they should not be required to pay pre-payments or upfront fees.
If you are searching these companies online, carefully read their privacy and security policies to ensure they will not “sell” your information and to find details about their business location (company’s legal name, address, and contact information).
- If using online search features, be cautious of giving any personal identifying information without full knowledge that this site is a legitimate lender. If completing an application online, make sure the information is encrypted by looking for the “https” URL and the “clicked” padlock. And remember, if you fall victim to a bogus loan website, you are also at risk of identity theft in the future.
- If the loan offer is “guaranteed” over the phone or online and you are instantly approved without sufficient background review – OR if the lender is more interested in processing the loan than in your financial health and history, then this lender is probably not “legit”.