Infamous Payday Loan Peddler to Finally Meet His Maker? Florida Court Will Decide
By Desmond CarlislePayday Loan Writer
Meet John Gill, Jr.
The Independent News reports that for at least 14 years, various payday loan schemes around the country have made him rich. Very rich.
The 48-year old Phenix City, Ala., man, who resides in a waterfront home on the Chattahoochee River on the Alabama/Georgia line, has, since 1992, been in trouble with the law in Alabama, Colorado, Florida, Georgia, Louisiana, New York, North Carolina, South Carolina, Texas, Virginia and Washington.
Yet despite a bevy of cease and desist orders, consent orders, assurances of discontinuance, injunctions, settlement agreements and appellate court decisions from various states, Gill often keeps right on operating in the same location simply by changing his companies' names, naming different principals, or employing other guises to conceal his ongoing payday loan activities.
The Texas attorney general alleges that his companies are really loan shark operations targeting military personnel and charging as much as 782 percent interest annually.
Gill filed for bankruptcy in 2003 in response to a class action lawsuit against him in Georgia. He purportedly took a vow of poverty and conveyed all his assets to the 'Ten Talents Ministry' and related entities which he controlled in order avoid civil and criminal liability.
- But will Gill finally face criminal charges that land him behind bars?
- Will he be forced to close his shady businesses once and for all?
- Maybe he will.
- Maybe not.
The lender in disguise" as he has been called by authorities, is scheduled for trial July 24 in Pensacola, Fla., on first-degree felony charges of unlawfully conducting a business under the state's anti-racketeering laws.
The case has drawn interest from consumer groups, such as the Center for Responsible Lending. They're not only interested because it's Gill, whose antics ended up in the New York Times in 2004 story when New York Attorney General Eliot Spitzer accused him of making "unlawful and deceptive" loans, but because the case is criminal. Businessmen like Gill often face action from overmatched state regulators that lack real ability to shut them down.
Florida's Assistant State Attorney, Russ Edgar, says Gill and associates have persisted in "criminal usury and loan sharking" for years.
"It is Gill's history of obfuscation and deceit, which the state intends to use to prove his intent, plan, knowledge, identity and absence of mistake in this case. In spite of the multiple actions by state authorities over a period of years, Gill continued to operate in the same manner, as part of a plan, and not from any mistake," Edgar said.
Gill and his attorney, O. Hale Almand Jr., did not comment.
Gill is also under fire in Texas, where Attorney General Greg Abbott froze his assets and sued his company for violating Texas finance laws and the Texas Deceptive Trade Practices Act by charging interest rates as high as 782 percent on short-term cash advance loans.
"These unlicensed practices are outrageous and are deliberately designed to target military families with extremely high-interest loans, putting consumers into a never-ending cycle of debt. Consumers have a right to do business with honest loan companies without the double talk, so in this case, we will ask the court to order restitution for all Texans who were harmed by this subterfuge," Abbott said.
So how does Gill's scheme work in Pensacola, and places across the country in states that allow so-called faxless payday advance centers, or don't? Officials say he does it by operating under the clever guise of check cashing services, or companies offering catalog gift certificates, Internet access, phone cards or a combination thereof.
- Here, Gill's Florida payday loan company was called Florida Internet.
- A consumer seeking a "payday loan" from Gill was instead given a $100 cash "rebate" for Internet access. But his company would withdraw $30 from the consumer's bank account every two weeks.
- At 782 percent interest.
Consumers also sign a contract agreeing to a "waiver of jury trial and arbitration" before receiving the initial personal loan. The company claims the contract releases it from liability, removes the threat of class action suits and allows it to enforce debt collection.Under Florida law, payday loan companies are allowed to operate. Although some state measures are in place protect the consumer, such as forbidding rollovers on payday loans, they fail to address the issue of interest rates. The Center for Responsible Lending says annual APRs are typically 400 percent or more, and the average borrower ends up paying $800 to borrow $325.
Yet Gill continues to stay in business.
Even though the Louisiana Department of Economic Development filed cease and desist orders for excessive financial charges in October 1992. Even though Colorado officials found him in violation in June 1993. Even after an Alabama grand jury ruled he was in violation of the state's small loans act and he was banned from the state in November 1993. Despite the fact that Washington authorities ordered him to cease operations and pay a $23,600 fine. And so on, until here in Pensacola.
Both Gill and consumer advocates will soon learn whether this criminal prosecution in Pensacola will finally put this infamous peddler of payday loans out of business.
