Online loans from Western Sky Financial and Cash Call
My friend David in the State of Florida was going through some serious hardship. So serious that 3 of his vehicles were repossessed and his electricity was turned off. The vehicles were impounded and the cost to take them out was a total of $12,000.00. His wife went into a very depressed time and was in bed for almost 2 weeks straight not wanting to eat because of the situation. He didn't want to see his family go through this situation and saw an advertisement on TV from a company called Western Sky.
They offered him $10,000.00 cash advance with a payment plan of $743.49 a month @ 89% interest rate. David did not have any financial concept or understanding as to what this meant. He was under the impression that his payment of $743.49 was going towards the money he owed. After 3 months of making these payments his wife saw the statement and realized that the balance on the account was increasing tremendously instead of decreasing. She flipped and started to cry because she knew he had gotten himself into a much deeper whole instead of getting them out of hardship. She called me and ask for help.
I informed that she should try investigating the laws in Florida regarding cash-advances because there should a cap on the interest they charging.. I know for a fact that hard-money can only go up as 18% interest in most states.. but I am not familiar with the laws in Florida regarding revolving accounts or cash advances.
When Western Sky contracted David to give him the loan, another 3rd party company by name of Cashcall based out of California is the one that who is actually withdrawing the money out of his account every month. Why do they have two companies I'm not sure. So I dug a little deeper and found that Cashcall is a registered company in the State of California (C2210310 01/28/2001 ACTIVE CASHCALL, INC. NATIONAL REGISTERED AGENTS, INC) but Western Sky is not.
At this point we don't know what to do to protect David's rights as a consumer or who to go to get help. He does intend to pay the money back, but he wants a fair and decent amount to go towards his principal. I think at this point he's getting ripped off. Can you please help David?
How do we act on protecting David's consumer rights and how do we help him avoid getting ripped off?
—Claudia Torres
Short answer
The interest on these online loans is illegal in many states. Western Sky Financial argued it was a tribal lender operating from the Cheyenne River reservation in South Dakota, and that argument has not gone well in the courts. If the payments are not affordable, the realistic options are to pay only toward principal, close the account the drafts come out of, and file a complaint with your state regulator.
Key points on this page
- Western Sky Financial appears to operate from the Cheyenne River reservation in South Dakota. The same operators have ties to several other online loan brands, including Payday Financial, Big Sky Cash, Lakota Cash, Great Sky Finance, Four Seasons Cash and Red Stone Financial.
- The amount and rate of interest these loans charge are illegal in many states. The tribal lender defense raised against state, federal and individual actions does not appear to be going well.
- One option is to keep paying, but only in an amount you can afford, and only up to the principal of the loan.
- Other options are closing the checking account the payments are auto drafted from, and filing a complaint with your state financial regulation office.
- At the time this page was written, Western Sky was not licensed in Florida, and the state of Florida had an active lawsuit against them.
- Expect collection calls and letters from Western Sky, CashCall, or both, if you stop paying. If finances stay tough, or things reach the point of vehicles being impounded and power cut off, it is time to speak with a bankruptcy attorney.
I am sorry to hear of your friend’s predicament with Western Sky Financial and CashCall. Going further into debt with what most of us would consider usurious loans, like those offered over the internet, offer a temporary measure to fill a cash gap, but are more akin to digging a deeper financial hole. But I get the reasons people will treat the loans as a life line.
I have followed some of the different developments with payday lending, offshore online lending, and so called tribal lenders. I have not kept up with recent events in this area of the debt markets. Your question gave me an opportunity to read up on a good 6 months of developments in the courts and elsewhere.
Western Sky Financial Operates in South Dakota
Western Sky Financial appears to be operating from the Cheyenne River reservation in South Dakota. The same people operating Western Sky appear to have ties to several other online loan operations: Payday Financial Big Sky Cash Lakota Cash Great Sky Finance Four Seasons Cash Red Stone Financial.
Why is their location of any importance? The amount and rate of interest Western Sky Financial, and other payday and internet loans charge, are illegal in many states. The argument Western Sky Financial is making in courts around the country (in order to defend court actions brought by state, federal, and individuals), is that they are tribal lenders. Having caught up on some reading as a result of your question, that argument does not appear to be going to well.
Taking out online loans from Western Sky, or any of their other entities, does result in getting money. Anyone taking out this kind of usurious loan is likely doing so because:
- Your credit score is too low to qualify for traditional loans.
- You are maxed out on credit cards.
- Your debt load is too high to get additional credit – even with a good credit score.
- Like your friend Dave, these loans are only considered when there are immediate hardships and expenses to cover.
My point is, you need the money at the time, found a way to get the money to fill the immediate cash void, and use the loan to get by. As screwy as this is to point out when talking about an online loan that will likely be found to be illegal in many instances, Dave got the money and used it to get by. He may regret the decision later, and learn that there were problems with the loan being made to him as a Florida resident, but what to do about the fact that he got something from Western Sky Financial?
How to Deal with Illegal Online Loans
Some options for Dave to consider when compared to how others have talked about handling repaying, or not repaying, Western Sky Financial would include:
- Closing your checking account payments are being auto drafted from.
- Making payments to Western Sky Financial, but only in the amount you can afford, and up to the principal of the loan.
- Contacting the Florida financial regulation office where you should learn that Western Sky Financial is not licensed in Florida, and file a complaint they can investigate: https://www.flofr.com/PressReleaseDetail.aspx?id=4228
There is an active lawsuit filed against Western Sky Financial by the state of Florida.
If your friend stops making payments to Western Sky Financial and closes the bank account any payments may have been being drawn from, he will need to be prepared for some blow back from either Western Sky Financial, or CashCall, or both. Collection calls and letters are to be expected. It is clear from what you shared that he cannot make the payments, and to do so even if he could, would be paying usurious interest to what is likely an illegal lender in Florida.
If it were me in Dave’s shoes, and I had the money in my budget to pay back something toward the loan every month, I would take a businesslike approach and contact Cash Call and Western Sky to let them know I will only be paying xxx.xx amount each month until the principal is paid. If I did not have the money in my budget due to further setbacks, I would wait and see if things turned around financially and then make an effort to pay the principal, or settle with CashCall or Western Sky or less. If finances remain tough, it may be time for Dave to speak with a bankruptcy attorney. If Dave is at a place where vehicles are being impounded, and power cut off, it may be time to consider his options with bankruptcy now, rather than later.
Anyone with questions about Western Sky Financial, Cash Call, or similar type of online loans and payments, is welcome to post in the comments below for feedback.
1/10/14 Updates to this reader question can be found throughout the comments below. A comment posted by Carol contains a link to more detailed information for Florida residents dealing with Delbert Services, Cash Call, and Western Sky loans. I replaced the previous link to the Florida action against these companies with Carol’s.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
Mr Bovee is there anyway i can email you directly without posting on this forum at this time?
Sure, just use the email address you get these comment notices from. That comes directly to me.
Michael can you tell me if Delbert Services is legal in Minnesota?
Debt collectors are required to be licensed and bonded in Minnesota, I do not know if Delbert Services is.
A better resource for answering your question is the Attorney Generals office in Minnesota.
This message is for Michael Bovee and hopefully I will get a response as I have not gotten one. And I know this may sound like a dumb question, but:
Is there a difference between a company that is specifically registered in a state to be a “collection agency” as opposed to being a company that buys loans (that are not past due or behind) ie. a mortgage company that buys mortgages from another bank (assignments)?
Thanks!!!!
Each individual state would likely be the resource to pose your question to. There are some states where there is a difference in requirements, bonding, etc.
Another blow to payday lenders in federal court: https://www.collectionscreditrisk.com/news/judge-rules-against-race-car-drivers-lending-business-3018059-1.html
I also took out a loan with Western Sky which was immediately sold to Cash Call then to Delbert. After researching I find this website and followed the advice given. I sent a cease and desist letter and revokation authorized debit from my account. I filed a complaint with CFPB in January which Delbert responded and offered to reduce my interest rate to 20%. Delbert listed a number for me to contact in which no one ever answered or responded. I began getting settlement offer with various interest rates or lump sum payments. I ignored each one. My concern is that even though Western Sky and Cash Call are not licensed in the state of Idaho, Delbert Services is. Delbert has reported negatively on my credit for that three months and I am concerned that they are going to try and sue me. I have paid over $1600.00 above what I actually borrowed and the balance is still over double what was borrowed, in fact the balance keeps going up. Why aren’t all states included in the law suit? I don’t know what to do. I have posted on here previously and have had no response, is it because I live in a state that is not included in the suit? I am just looking for some advice on what to do. Please please help me. I am just looking for some advice. Thank you in advance for your time.
TLM – There is not much solid to offer you. You may want to consult with an attorney in Idaho with a practice focus in consumer law. This may help you get a lay of the land regarding debt collection and credit reporting, but also ask about any irregularities with how the loan was made, and promptly passed on to other entities, etc.
Here is an experienced consumer debt attorney in Idaho:
Ryan Ballard, Esq.
Ballard Law, PLLC
237 North 2nd East, Suite 102
Rexburg, ID 83440
Phone: 208-359-5532
Delbert is also legal in my state, buy my AG office said that the original loan with Western Sky (which they immediately passed to Cash Call) was not legal in this state, and Cash Call’s license was suspended so they passed to Delbert, and that they have never had one of the cases from Western Sky go to court. I had copies of all the correspondence between Western Sky and Cash Call, and proof of how the loan was transferred quickly because of legal issues, and I have paid them back the principle plus a good amount more. The AG office said to stop paying Delbert so I did. They do ding your credit, but my credit was not great or I never would have borrowed from them to start with. I would make sure you pay the principle back. I keep getting offers from Delbert but I never respond. I filed a complaint with the Fed consumer group and indicated that I consider the loan paid in full. I sent a cease and desist and closed my bank account as well.
TLM ,
At this point, I would quit making payments to them. Even though they “sold” the note to Delbert Services, I have been told that both Western Sky and CashCall were not legally licensed to be operating in many States at the time of these loans. What I found to be truly funny and may work in my advantage for my case is that when I did my loan last year in July, Delbert Services started taking out payments before the loan was even “sold” to them. I had the first payment drafted from Delbert Services, then the next 3 payments were drafted by CashCall and then it went back to Delbert Services. That is completely illegal. It’s either one or the other. They cannot switch back and forth. Definitely talk to this lawyer and go from there. I wish you luck
I took out a loan with Western Sky and have been paying on it for over a year. Are they licensed in the state of Texas? They also told me I have 2 different interest rates and I won’t ever be able to pay this off. The 10 day pay off is way more than what I actually borrowed. I feel as though I am being swindled. Any advice would be greatly appreciated!
Does anyone have any updates on where the state of New Jersey stands with WS/CC/Delbert?
I have filed noticed with NJ AG office and CFPB but have not seen or heard of any updates ! Any updates would be greatly appreciated !!
New jersey has been another state added to cfpb lawsuit go to states added to the original complaint.
i live in new jersey, payday loans are illegal stat.Ann. tit.1 ussury cap at 30%. N.J STAT.Ann 2c;21-19 a c
bottom line payday loans are PROHIBITED!
go to bank dept file a complain!
SO GO ONLINE COPY THE LAWS WRITE A LETTER TO THE CREDIT BUREAU THAT IN NEW JERSEY LOAN OF THIS TYPE ARE ILEGAL, SO THERE WAS NEVER A LEGAL CONTRACT! send copys of everything to credit bureau they will remove it!
note in new york every one is getting back all moneys paid to the cashcall. delbert service, western sky
send copys of every thing to the state and federal consumer dept
Can someone tell me how do I go about getting them removed from my credit report?
I too had a loan (actually two, i obtain another after paying off the first). I then learned just after paying the principal that Western Sky was providing loans without being licensed in my state. Delbert took over, I stopped paying, sent them a cease and desist and started filing complaints against them with my AG and the CFPB. They dinged my credit. I wrote to the credit agency, initially they did nothing, then I filed a complaint against the credit reporting agency with the CFPB, detailing the situation and restating that the CFPB has filed suit against this same company for the same reasons that I am filing my complaint. A week or so ago, I received a response from the CFPB advising that the reporting agency has agreed to remove that information from my credit report. I then received an email from the reporting agency advising that they were removing the information from my report. The information has since been removed. I have not received any more collection efforts from Delbert. But I would like the excess interest I paid to be returned. However I am satisfied to be left alone.
Do you mind sharing what you wrote to CFPB regarding credit reporting agency. I would like to write them as well. Thank you.
Would you please share what you sent to the CFPB to get this loan removed from your credit report? Delbert now has my loan listed as a Charge off. I have filed complaints with CFPB as well as the State of NJ AG and have not gotten any satisfaction. Would love to just get this off of my report ! I took out 5K paid back 7787.00 they got their principal back and then some !
Also does anyone have any updates on NJ? I can’t find a thing !
I don’t think it’s legal for these two companies going back and forth drafting from your account. I wrote to Cash Call to stop the ACH drafting but I did not trust them so I just closed my account with Chase. I did the same thing with the Cash Call website, they are not licensed in Indiana unless I was a business. My loan is an installment loan I took out from Western Sky, who immediately sold it to CashCall. I’m sure my loan is now in the hands of Delbert, however I have not had to deal with them yet.
Kelly, I have done the same thing. I opened a new one, closed the old and have sent cease and desist letters to both CashCall and Delbert telling them that I would only deal with Western Sky right now. It’s funny because the email that I specifically addressed to Cash Call got an RE: response from a rep from Delbert. And I specifically asked them, why they are responding to an email that was sent to CashCall and not them. But they will not answer. They have twice sent an email that states that I need to call them and they will explain it too me. I consider it all to be deceptive. And the cashcall I sent it too is in California and the license on file in Texas for Delbert says they are in Neveda. So are they blately lying to people? I know they are all one in the same…but the more bologni I can catch them feeding me, the better a paper trail I will have.
That was what I was wondering. And what is funny is the other day, I went to CashCalls website to get an email address and just for the heck of it started the online process for a loan and it said it couldn’t lend to me in Texas UNLESS I was a business. If I cannot find any licensing on them in Texas, how can they even do that? It all doesn’t make any sense. And I also emailed a question in earlier today and am waiting for an answer, but when they first started drafting me, the first draft was a paper draft to Delbert services, but then the next 3-4 were ach drafts from CashCall. Then they went back to Delbert. I did not think it was legal to have different companies drafting your account then switching back and forth. If they sold to Delbert (which we know they are one in the same) then it should stay with Delbert not randomly go back to CAsh Call drafting me. Anyone’s input would be great!!!!
The first paragraph includes other related/non related headlines, when I copied this on to this page I didn’t intend to include that. This is great news for those of you affected in New York. I sure hope other states follow NY case and will go after Western Sky/ CashCall/ Delbert. I am a bit confused though. I am guessing this case only applies to “payday loans’, so did Western Sky also issue installment loans and I wonder if this lawsuit would apply to that type of loan as well?
FYI :
NY Regulators Cap Payday Lending Case
by Darren Waggoner
MAY 21, 2014 10:53am ET. Print Email Reprints Comment Twitter LinkedIn Facebook Google+ ..Related
NY Regulators Cap Payday Lending Case
Collection Execs Banned as Regulators Close Texas Operation
Minnesota Senate Fails to Pass Payday Loan Reform.The case against a South Dakota-based payday lending operation that charged illegal interest on loans is wrapping up in New York state where residents can now start filing refund claims, according to New York Attorney General Eric Schneiderman’s office.
More than $20 million could be distributed, depending on the number of consumers who make claims, and many borrowers will receive a refund of more than $1,000. The settlement included penalties totaling $1.5 million.
All borrowers who received loans from Western Sky Financial LLC and CashCall Inc. or any party collecting on their behalf more than the proceeds of the loan plus the legal interest rate of 16% are eligible for a refund, according to the AG’s office.
Western Sky agreed last year to stop funding loans amid rising legal battles with authorities in several states. It previously cited “unprecedented government interference” as the reason for laying off the majority of its employees in Timber Lake, S.D. and its decision to close its office in Eagle Butte, S.D.
Last October, owner Martin A. Webb and Western Sky were among the defendants sued by Arkansas Attorney General Dustin McDaniel’s office for allegedly to offer illegal payday loans online while claiming to be affiliated with a Native American tribe to avoid legal action.
Webb and his companies, including Western Sky, offered payday loans ranging from $300 to $2,525 to consumers across the U.S. and advertised on television and online, according to a Federal Trade Commission complaint. The defendants tried to garnish consumers’ wages without a court order and sought to manipulate the legal system by forcing borrowers to appear before the Cheyenne River Sioux Tribal Court in South Dakota, which did not have jurisdiction over their cases.
“Debt collectors cannot garnish consumers’ wages without a court order, and they cannot sue consumers in a tribal court that doesn’t have jurisdiction over their cases,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Regardless of tribal affiliation, debt collectors must comply with federal law.”
Webb and Western Sky last month were ordered to pay $967,740 to the U.S. Treasury to settle FTC charges of using unfair and deceptive collection tactics.
Schneiderman’s office sued Western Sky and its affiliates last summer, accusing them of charging interest rates to New Yorkers that were more than 10 times the higher than the state’s interest rate limit of 16%.
“Thousands of New Yorkers who were the victims of exorbitant and illegal interest rates can receive meaningful relief through our settlement fund,” Schneiderman said in a release. “I encourage all those eligible to take full advantage of this program.”
The New York AG’s office has been cracking down on payday lenders in the past year.
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That is great. Now if I could only get some info on Texas. I am thinking the whole entire loan thing is illegal since I cannot find any licensing on this. I am also worried because most of this stuff has dealt with their payday side of the lending not the installment loans. But if they aren’t licensed to lend then they aren’t licensed to lend.
Is there a way to see if these companies are licensed in your state? I am in Texas and I have looked on the AG office website and the nmls licensing thing that I believe is on the OCCC in Texas website and cannot pull either of them. I believe from posts I have read on other sites that at one time Cash Call was licensed in Texas but for mortgages only. Does that give them the ability to do personal loans also? As I said now I cannot find anything about their licensing. Also, (and I may be mistaken) but from other posts on other sites any of these loans originated with Western Sky are illegal period. Is this true? Does anyone know?
The AG in GA has filed a suit against Western Sky/Cash Call/Delbert but this was last year, In July. How long does it usually take for the courts to hear these cases?
What are the laws about this kind of stuff in Louisiana. I had a loan with Western Sky / Cash Call then it got transferred to Delbert Services. The loan was for $2600. I have paid them $4500 and still owe over $3000. My interest rate is 135%. This is killing me to continue to pay them this outrageous amount.
I live in NJ and just saw all of this stuff. I currently have a loan out with Delbert Services and actually just made a payment of $700.00 trying to get this loan paid off. Can I do anything to get this and other recent payments that I made back? Any help is greatly appreciated.
Hi Michael, GA filed a lawsuit against these guys last year. Is there anyway or anyplace to get an update as to the status? The AG website says the case is still open in Fulton County Superior Court.
Thanks
James
James – If Fulton Count Superior court has online access to their docket, you can check their site for recent filings, and get a gist for where things are at with the case. You can also stop in the court.
I am sure he has some judge in his pocket there.And the laws in california regarding this lender is very lax.I would hope the judge reveiwing this case will not dismiss claims and not allow him to tranfer to central district of cali.
I was searching for updates in the lawsuit against Cash call from CFPB. See Case 1:13-cv-13167-GAO Document 32 Filed 4/11/14. It appears that they want the case to be transferred to Central District of California or, alternatively, to dismiss all claims against J Paul Reddam for lack of Personal Jurisdiction.
I did register for PACER, didn’t really get any information I was looking for so I sent them an e-mail to pay whatever I owe and close it since I doubt I’ll ever have a need again to access the website. I will just continue to have patience and wait the outcome.
I hear ya. I just pulled the docket after seeing your comment. Not much happening in the case yet. Jurisdictional issues will be resolved before discovery which is where you can often download filings along with a bowl of popcorn. That said, I would like to change my guess to next year….
So was doing a little research i wonder if cashcall in the UK has the same owner as in the U.S.which is Mr J .P.Reddam?No wonder why this crook has so much money!! He is probably ripping people off in the U.K. too!!!!!!!!!!!!!!!!
Is there anyway to find out about the status of the CFPB complaint? I know it was filed on December 16th and an amended complaint updated on March 25th. How long do these lawsuits generally take, months, years? I am anxiously waiting the outcome. I have managed to get all my old debts paid off with the exception of a car payments and Western Sky/Cash Call. This Western Sky/Cash Call loan is the only thing holding me back and I have paid above and beyond the principle and refuse to pay them anymore pending the outcome of this lawsuit. I live in Indiana( where the loan was originated as well) which is one of the states named in the lawsuit under ” Violation of Interest Rate Caps and Licensing Requirements”.
If you are really into watching this type of thing unfold, and want to get into the minutia of the case being presented by the CFPB, and the defenses too, use PACER to get up to date federal court information. The case is filed in federal district court of Massachusetts
Does anyone know — would the outcome of the case only affect those states named? Or would it be federal and impact all states since the federal government is bringing the suit?
My guess is that the case will get settled, and that the CFPB will be looking to bring an impact to consumers nationally as part of that agreement. States like mine that do not seem to have this issue on their radar would benefit from this. But it’s hurry up and wait to see if I am right.
Thank you Michael, I did register for access to PACER.