Usury, a dictionary definition shows that Meta Bank practiced usury openly for years

1. the lending or practice of lending money at an exorbitant interest.
2. an exorbitant amount or rate of interest, esp. in excess ofthe legal rate.
Usury is both illegal and immoral.
Hasn’t Meta Bank understood this yet?
Underbanked” and “unbanked” are terms that Meta Bank and other banks use to rationalize their practice of usury.
The problem may be that the Haahr family does not view others as themselves or as their neighbors, or how could they even consider treating others, other human beings, in the ways they treat them.
650% interest rates!! Deceit is not being neighborly. No one would knowingly sign up for that kind of interest rate if they had other viable options explained to them; Meta Bank stood a lot to gain so why go any further than they had to before making the money they wanted. Customer service is not Meta Bank’s priority. Meta Bank’s values are not the values we want our children exposed to or to have held up for them as role models. Meta Bank’s values are aberrant and abhorrent if America is to proper and to thrive.
If anyone begins to think that 650% interest rate is normal or acceptable, there will never be any hope for America’s future. The thought process behind the actions that allowed Meta Bank to establish its broad network is a form of criminal thought.

MetaBank Collecting on Outstanding I-Advance Debts

October 21st, 2010

MetaBank is wasting no time in attempting to collect on the outstanding balances on their now closed i-advance lines of credit.

How MetaBank would collect on the i-advances that were extended to existing customers has been a question ever since the OTS’ action against the thrift from Storm Lake. The Office of Thrift Supervision’s October 12th Supervisory Directive forced MetaBank to close existing i-advance accounts. On its website, MetaBank acknowledged that it was not sure how well they would be able to pull back their loans.

MetaBank published an 8-K later that day which warned investors about the situation.

We cannot predict with assurance whether and to what extent the OTS will address the compliance and supervisory matters in addition to those described above. However, the OTS has informed us that it will address in the future its expectations with respect to reimbursement of borrowers under the iAdvance program. It is anticipated that thediscontinuance of the iAdvance program and the potential discontinuance of the tax-related programs (which are subject to OTS approval) will eliminate a substantial portion of MPS’ gross profit. In addition, the discontinuance of the iAdvance program may result in elevated  rates of nonpayment on outstanding iAdvance loans.

There is some important information here with respect to the ability of MetaBank to collect. For one, the statement hints that the OTS may itself decide to determine how and to what extent MetaBank can collect. Most importantly, it puts the cards on the table that the iAdvance balances are in jeopardy.

MetaBank’s cards used the expectation of a direct deposit to collateralize short-term advances. For each $20 increment, MetaBank charged a fee of $2.50. The consumer had until their next direct deposit (up to a maximum of 35 days) to pay it back. Otherwise, the money was deducted from the next direct deposit. Unstated but implicit to the arrangement was that a borrower could take out a new advance immediately if they could not extinguish all of the debt.

Re-upping is often referred to as a “rollover.” MetaBank has told me that their customers cannot roll-over, but their assertion is based on a technicality. The direct deposit does satisfy the existing debt, but that claim ignores the instance of a new loan.

Now, the option of rolling over is gone. MetaBank can’t offer a new i-advance. If their non-rollover claim was true, there wouldn’t be a problem. Unfortunately for consumers and for MetaBank’s balance sheet, these customers were rolling over.

MetaBank’s response appears to be that they will take all of the outstanding debt at the next direct deposit.

[Note: please research how Meta Bank treated Boesen’s widow. Should Meta Bank have loaned the money to Boesen without checking into his financial history, and without his wife being physically present making the application? Meta Bank went after all of the widow’s assets immediately upon Boesen’s death. They did not wait; money came first, and they are a financial institution. For this reason, I believe that strict rules should be put in place to govern Meta Bank since they are a financial institution and they do not behave in ways that we would expect humans to act.]

A consumer advocate in Washington says that she has encountered a retired woman from Pennsylvania who claims that MetaBank plans to garnish the next direct deposit of her Social Security payment. According to the borrower, she took out an iAdvance for $300 in August. Since then, she has been covering that debt with a new advance. She now owes $320. MetaBank says that they will take it all at the end of this month.

There are a number of situations where this policy runs afoul of the law. For one, unless you are the Treasury Department or if you are trying to collect on child support, it is against the law to put a garnishment a Social Security check. There’s also the possibility that a judge would classify an i-advance from a prepaid card within the definition of a credit card. If that was the case, then a claim could be made that it is a violation of the Truth-in-Lending Act to put an offset on a credit card. [Note: This would be news to Meta Bank based on how they operate which is similar to the old stereotype of “bookies” we used to see on “B” rated movies]

From my perspective, MetaBank deserves to collect on the principal that its iAdvance consumers have drawn from the company. The question is really about how they do it. Taking all of the money right away is certainly one way to jump start that process. At a time when regulators are watching so closely, it seems like a decision that puts money in conflict with prudence.[note: Does the writer think so?] An alternative plan would be to set up a payment plan. Illegal garnishment is just more blood in the water. [Note: A payment plan for a person in Pennsylvania who has paid their bill many times over? How do you think that woman is going to like that? The problem is that the customer is completely discredited and not included in any of the decision making process. Simply by having dealt with Meta Bank, their customers have given up all of their personal rights, and this is based on all false promises. I don’t think that the person who wrote this original article “Exploring the Finances of the Unbanked” in Bank Talk as “MetaBank Collecting on Outstanding I-Advance Debts” may not have all the history behind what created this situation that drew Meta Bank to the attention of the Office of Thrift Services in the first place. Meta Bank is the rotten apple that spoils the rest of the batch.]

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