BUSINESS

Payday loan marketer loses Montel Williams as pitchman in New York, to pay $2.1M penalty

03/10/2015 05:35 EDT | Updated 05/10/2015 05:59 EDT
ALBANY, N.Y. - An online company is losing Montel Williams as its celebrity pitchman in New York while agreeing to stop generating leads in the state for payday loans with interest rates sometimes topping 1,000 per cent.

New York regulators say the Las Vegas-based company has agreed to pay a $2.1 million penalty. Williams has signed an agreement saying he'll stop endorsing MoneyMutual loans in New York.

The state says an investigation found the company Selling Source marketed illegal loans to New Yorkers while doing business as MoneyMutual.

New York's annual interest rate limit is 16 per cent. A consent order says the company acknowledges its typical annual percentage rate on a 14-day loan is "between 261 per cent and 1,304 per cent."

A spokesman says the investigation found no violation of law by Williams.

Selling Source says it co-operated with regulators.