CHICAGO – Affinity Credit Services today was ordered to pay $273,000 in fines for issuing loans at five stores in Central Illinois and suburban Chicago without first obtaining licenses under the Consumer Installment Loan Act (CILA). The stores were purchased by Affinity in May 2006, from Americash Loans, a licensed CILA lender, but did not become licensed until August 2, 2006.
As a result of a consumer complaint, the Illinois Department of Financial and Professional Regulation (IDFPR) conducted an examination of these facilities and learned that 273 loans were issued between the May purchase and the date the stores were licensed in August. IDFPR has assessed a fine of $1,000 for each loan that was improperly issued.
“Governor Blagojevich has charged our department with protecting Illinois consumers from high-cost installment loans. We will not tolerate unlicensed activities from this or any other consumer loan company,” said Dean Martinez, Secretary of Financial and Professional Regulation.
Illinois law requires each lending facility to be separately licensed, after meeting the State’s financial standards. When the ownership of a store changes, the license of the seller is no longer valid at the facility and a license must be issued to the new owner. In its sales contract, Americash made clear that Affinity was responsible for obtaining valid CILA licenses for these stores. Affinity’s licenses were approved on August 2, 2006 but the stores had been issuing loans since mid-June.
The five stores are:
Freeport. – 624 W. South Street, began issuing loans on June 13 and issued at least 71 loans prior to becoming licensed on August 2, 2006.
Sterling – 2901 E. Lincolnway Highway, made 33 loans between June 12 and August 2, when its license took effect.
Ottawa – 2620 Columbus, began making loans on June 17 and issued at least 17 CILA loans between that date and the date it was licensed, August 2, 2006.
Lombard – 54 West Roosevelt Road, began issuing loans on June 21, 2006 and issued at least 104 loans before its license took effect on August 2, 2006.
Bridgeview – 10272 South Harlem Avenue, started operating as an Affinity Credit Services outlet on June 19 and made at least 48 loans before becoming licensed on August 2, 2006.
Today’s order takes effect immediately, unless the licensee requests, in writing, a hearing within 10 days. In the event a hearing is requested, the order will be stayed until a final administrative order is entered.
Should this matter not be resolved, IDFPR has the authority to refer the case to the Attorney General, who can prosecute the store owners for unlicensed business practice. Section 20(a) of CILA, 205 ILCS 670/20(a), provides that “[a]ny person who engages in business as a Consumer Installment Loan lender without the license required by this Act shall be guilty of a Class 4 felony.”