WASHINGTON – Ace Cash Express Inc. has agreed to pay $10 million in a settlement with federal regulators who accused the payday lender of illegally harassing borrowers to collect debts and get them to take out additional loans.
The Consumer Financial Protection Bureau announced the agreement with Ace, one of the biggest payday lenders in the U.S. The company will pay a $5 million fine and return $5 million to affected customers.
The CFPB said Thursday it was its first action against a payday lender for forcing consumers into a cycle of debt.
Ace, based in Irving, Texas, didn’t admit wrongdoing in the settlement. The company said in a statement it has cut ties with the outside collection agency which the regulators had expressed concerns about.