EDMONTON - The Cash Store Financial Services Inc. (TSX:CSF) says it will request a hearing before Ontario's Licence Appeal Tribunal in response to government pressure on its lending businesses.
The company says Ontario's registrar for payday loans wants to revoke the payday lending licences of its Cash Store Inc. and Instaloans Inc. businesses.
However, Edmonton-based Cash Store Financial says it no longer offers payday loans in Ontario since introducing line of credit products.
Cash Store Financial says Ontario's Ministry of Consumer Affairs has attempted since September 2011 to force it to deliver payday loans in cash, rather than the electronic methods they now use.
The company says it's unwilling to place employees and customers at risk by having them handling cash.
Ontario premier-designate Kathleen Wynne declined to comment on Cash Store, but said the Liberals brought in legislation to tighten up the rules.
"We brought in that legislation because there were vulnerabilties for people who were using those services and we want to make sure they are protected," Wynne said Wednesday.
Cash Store Financial Services said the Consumer Affairs' consumer protection branch has also attempted to stop the Cash Store Inc. and Instaloans Inc. from selling products other than payday loans.
"The companies have indicated that they are not prepared to accept these onerous restrictions," Cash Store Financial Services said in a news release.
Cash Store Financial is listed on the Toronto Stock Exchange.
The following graphic shows use of payday lenders, in the U.S., by income bracket
'Do You Want To Pay Now?'
Bruce Folken was still "out of it" when a hospital employee entered his room and asked if he wanted "to pay now." Afraid the care he was being given would suffer if he said no, Folken agreed as the employee took his debit card from his wallet and charged him $493.60, <a href="http://www.huffingtonpost.com/2012/05/18/hospital-debt-collection-health-care_n_1528124.html?ref=business#s609557&title=8_Affording_Minimum" target="_hplink">The Huffington Post</a> reports.
Cancer Survivor Sent To Debtors' Prison
Breast cancer survivor<a href="http://www.huffingtonpost.com/2012/04/23/lisa-lindsay-breast-cancer-survivor-debtors-jail_n_1446391.html" target="_hplink"> Lisa Lindsay of Illinois was taken from her home in handcuffs and put in debtors' prison</a> over a $280 medical bill that was sent to her by accident. Eventually, she agreed to pay $600 just to settle the charges.
Unspeakable Debtor Threat
According to the FTC, employees at one debt collection agency <a href="http://www.huffingtonpost.com/2012/04/13/debt-collectors-abusive-economy_n_1422107.html" target="_hplink">threatened a debtor</a> by saying they would "dig her daughter up and hang her from a tree if she did not pay the debt," <a href="http://bucks.blogs.nytimes.com/2011/10/26/f-t-c-claims-abusive-tactics-by-two-debt-collection-firms/" target="_hplink"><em>The New York Times</em></a> reports.
Impersonating Police Officers
The West Virginia attorney general filed suits in April against seven debt collectors for <a href="http://www.huffingtonpost.com/2012/04/19/west-virginia-attorney-general-debt-collectors_n_1435549.html" target="_hplink">allegedly impersonating police officers</a> in order to harass borrowers who in some cases didn't even owe any money.
Debt Collectors Report Fake Suicide Threat
Eighty-five year-old Anne Sessions spent hours in the hospital incurring a $1,055 medical bill when debt collectors called authorities to <a href="http://www.huffingtonpost.com/2012/02/10/anne-sessions-oregon-octogenarian-suing-debt-collector-fake-suicide_n_1269267.html" target="_hplink">falsely report that she was threatening suicide</a>. The debt collector reportedly asked her "how would you do it?"
Woman Jailed Over Car Accident Fees
Colorado resident <a href="http://www.huffingtonpost.com/2011/06/20/debtors-prison-jail-for-a_n_880321.html" target="_hplink">Kelly Wiedemer spent four nights in debtors prison</a> in June 2011 when a police officer pulled her over for having unregistered plates and discovered she still owed money from an accident that happened in 2009. "I thought debtors' prison was supposed to be unconstitutional," Wiedemer said.
Debt Collectors Set Up Facebook Profiles
Debt collectors will "<a href="http://www.huffingtonpost.com/2012/04/24/debt-collectors-facebook_n_1448792.html" target="_hplink">set up fake profiles and friend consumers on Facebook</a>, just to get into their personal information," according to one financial planner.
Rincon Charged With Threatening Non-Debtors
The FTC charged Rincon and six other debt collection agencies for using threats and insults to try and collect money from <a href="http://www.huffingtonpost.com/2011/10/27/ftc-debt-collectors-federal-trade-commission_n_1033839.html" target="_hplink">people who didn't actually owe any</a>.
Phony Police Threats Terrify Couple
When an official-sounding debt collector told Wayne and Brenda Foster they'd be dealing with police unless they paid up, the couple reached for their wallets. So did hundreds of others. But thanks to an FTC investigation of fake debt collectors, the <a href="http://www.huffingtonpost.com/2012/04/11/ftc-busts-scam-debt-collector_n_1418582.html" target="_hplink">multimillion dollar scheme to rip off consumers was shut down in April</a>.
'Nice People Collect More'
Turns out nice guys don't always finish last. Debt collector Access Receivables increased payments by 40 percent after adopting a new <a href="http://www.huffingtonpost.com/2012/05/01/access-receivables-nice-strategy_n_1467902.html" target="_hplink">"nice people" strategy emphasizing customer service</a>.