Madison, Mississippi based All American Check Cashing is under fire again after the U.S. Consumer Financial Protection Bureau (CFPB) filed suit against the company for allegedly engaging in deceptive practices. All American is also the subject of an enforcement action by the Mississippi Department of Banking and Consumer Finance.
The CFPB lawsuit alleges that All American and its employees deceived customers in regard to the extent of their fees. In fact, the company is accused of having a policy to conceal the amount of their fees. In training, new employees were allegedly instructed to never tell the customer the fee charged to cash the check and instead to say they did not know what the fee would be.
If a customer tried to back out of the transaction, CFPB alleges that employees would falsely state that it was too late to reverse the transaction or intentionally make it impossible to do so by stamping “For Deposit Only: All American Check Cashing Inc” on the back of the check.
All American is also facing shutdown by the Mississippi Department of Banking and Consumer Finance due to its alleged violation of the state’s law against “rollover” loans. This law is supposed to prevent “collecting fees on loans while issuing a new loan to pay off the old one.”
Of course, All American denies any wrongdoing and instead argues that they are the victims of “government thuggery” and “draconian” penalties. After dealing with check cashing companies on a daily basis and seeing first hand how they operate, I find their defense laughable.