The investigation by US Consumer Financial Protection Bureau follows a ProPublica story that detailed the company’s lending practices
World Acceptance Corp., one of the largest high-cost installment lenders in the United States, disclosed today that it is the target of an investigation by the federal Consumer Financial Protection Bureau.
World, which does business as World Finance, was the subject of an investigation by ProPublica and Marketplace last May. Our story showed how the company's loans are deceptively expensive and often trap borrowers in a cycle of debt. World's business hinges on convincing low-income borrowers to renew their loans over and over again, a practice that can radically increase the amount of interest they pay. The company also packages nearly useless insurance products with its loans in many states, allowing it to skirt state interest rate caps, our investigation found. World boasts more than 800,000 customers.
According to World's disclosure, the CFPB is investigating whether the company is breaking federal laws in how it markets and offers its loans. The CFPB has made a Civil Investigative Demand that requires World to produce documents and answer a list of questions, the company said in a Securities and Exchange Commission filing.
"The Company believes its marketing and lending practices are lawful," the statement concluded.
Last July, Sen. Ron Wyden, D-Ore., citing ProPublica's story, pressed a top official from the CFPB during a Senate committee hearing on what the CFPB might do to address the company's practices.
The CFPB, which was created by the 2010 financial reform bill, has broad authority over non-bank lenders like World that in the past had minimal federal oversight. Last November, the bureau took its first enforcement action against a high-cost lender, fining payday lender Cash America $5 million for robo-signing documents in debt collection lawsuits and overcharging service members and their families. The company also paid $14 million in refunds to consumers.
UK’s Financial Conduct Authority is using insights from behavioural economics for...
A negative closing tomorrow may mean a short decline in Nifty
Yesterday, we had mentioned that the Nifty is readying for the next upmove but a close below 6,480 on the Nifty will create a short-term bearishness. Today the index made a plunge to level below it by hitting a low of 6,477 and closing 13 points above that level at 6,493. The index has not been able to get past 6,560 and if it closes in the negative tomorrow, it will mean a short-term decline.
The market was driven lower today due to a weakness in software stocks, after Infosys warned that its March quarter earnings will come at the lower end of guidance. But the market shot up immediately on the back of the improved data on index of industrial production and the inflation given out after market hours on Wednesday.
The Sensex opened at 21,737, while the Nifty opened at 6,492. After a range bound session until the last hour the market lost its strength and plunged into the negative and closed almost near to the day’s low. The Sensex hit a high of 21,991 while the Nifty hit a high of 6,561. The Sensex closed at 21,775 (down 82 points or 0.37%) after hitting a low of 21,720, while the Nifty hit a low of 6,477 and closed at 6,493 (down 24 points or 0.37%). The NSE recorded a little higher volume of 67.22 crore shares.
The Index of industrial production (IIP) rose 0.1% in January 2014, with the index snapping a decline for the last three sequential months.
Inflation based on the consumer price index eased to a 25-month low last month. The rate of inflation based on the combined consumer price index (CPI) for urban and rural India eased to 8.1% in February 2014, from 8.79% in January 2014. Core CPI inflation, which excludes food and fuel prices fell below the 8% mark for the first time in 7 months. Core CPI inflation stood at 7.9% in February 2014, lower than 8.1% in January 2014. CPI inflation eased for all groups except clothing in February 2014.
Infosys was the laggard in the Sensex 30 stocks which fell 8.54% to close at Rs3357.50 on the BSE. Infosys tanked on reports that it foresees sluggish growth in January-March (Q4FY2014) quarter mainly due to muted spending by clients, especially in the retail sector.
US indices closed flat with a positive bias. Market now awaits the jobless and the retail-sales data.
Asian indices closed mostly in the green. Shanghai Composite (1.07%) was the top gainer while Hang Seng (0.67%) was the top loser.
China's industrial-output, investment and retail-sales growth cooled more than estimated in the first two months of the year, signaling a slowdown in the economy as leaders seek to sustain 7.5% expansion. Factory production rose 8.6% in the January-February period from a year earlier. Retail sales advanced 11.8%, while fixed-asset investment excluding rural households was up 17.9%.
Chinese Premier Li Keqiang warned on Thursday that the economy faces "severe challenges" in 2014. His comments came against the backdrop of weak data which fanned speculation the central bank would relax monetary policy to support stuttering growth.
Australia boosted full-time payrolls in February by the most in more than 22 years. The number of people employed full time rose by 80,500, the biggest increase since August 1991 and the second largest rise on record. Overall employment climbed 47,300.
European indices were mostly up, while US Futures were trading marginally higher.