Operation Sunset to crack down on payday loan industryPosted: Updated:
PHOENIX -- The Arizona attorney general is warning the state's more than 600 payday loan stores that it will not be business as usual come the end of the month.
Attorney General Terry Goddard on Wednesday announced Operation Sunset, a crackdown campaign designed to make sure payday loans end when the are supposed to.
The law the allows those high-interest loans expires on June 30. It was a 10-year exemption from Arizona's cap on annual interest rates approved in 2000.
The concern is that some payday loan stores will continue to operate, charging more than the allowed interest rate of 36 percent.
About 200 stores have already made requests to stay open and transfer to a different kind of business.
Goddard said payday loan can be offered in sneaky ways, including offering them as car-title loans or through a middleman. Despite those disguises, such loans will be illegal.
Starting July 1, a hotline will be up and running for people to report problems.
Goddard said his team will aggressively pursue payday lenders who continue operations.
"It's not going to be easy. This is a vigorous and well-funded opponent," Goddard said. "They are going to be trying to keep their foothold here in Arizona. Our bottom line is to make sure Arizona consumers have the facts, they know where to complain if they see an abuse, and to keep the payday lenders within the law."
Goddard said Operation Sunset will also crackdown on Internet loans.
The Operation Sunset hotline number is 1-866-879-5219.