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California payday loan firm faces charges

August 2, 2006 - Pasadena, California

A payday loan company with offices in Arcadia and Eagle Rock faces allegations of deceptive business practices and fraud in a complaint filed Tuesday by the California Attorney General's Office.

The complaint, which will be heard in Pasadena Superior Court, seeks at least $2 million in civil penalties from the now defunct Fast Cash loan service, including $350,000 in restitution to former customers.

The company is alleged to have charged excessive and illegal penalties to customers who wrote bad checks to secure what are commonly known as payday loans.

"Fast Cash extorted outrageous amounts of money from its customers," said Attorney General Bill Lockyer in a prepared statement. "They threatened lawsuits, tried to squeeze settlements, and, when that did not work, they deceived the court" to win improper judgments against more than 400 customers.

Under California law, when a customer bounces a check used to secure a payday loan, the lender can collect a penalty equal to the amount of the check and a $15 handling fee.

The complaint says Fast Cash demanded customers pay four times the amount of the bad check. Any customer who refused to pay was taken to small claims court.

According to AG spokesman Aaron Carruthers, since a majority of the borrowers did not attend the hearings, and Fast Cash did not divulge the nature of its loans, the court generally ordered that the penalty be paid.

"We are asking the court to void any and all judgments that were made," Carruthers said. "We are also asking that they be barred from conducting this type of business again."

The owner and founder of Fast Cash is Christoph Hoppe, 39.

Hoppe, whose last known address is in Laguna Hills, could not be reached for comment Tuesday. According to his former in-laws, he fled the country last year, returning to his native Germany and leaving behind a trail of unhappy creditors, disgruntled ex-employees and failed schemes.

Hoppe is described as a "fast-talker" and a "narcissist" with a taste for expensive cars and a habit of making bad business decisions.

"This guy was all over the place, trying to get into God only knows what," ex-wife Jennifer Bradley said

Bradley, who now lives with her parents in San Marino, said Hoppe spread himself too thin when he opened the two payday storefronts and was soon "bleeding" cash "out of every corner."

She said Hoppe tried a number of other ventures in an effort to regain his financial footing, including an online real estate business and a small toy company. When they failed, he left the country, abandoning his business records in a Pasadena storage unit.

Because the records contained sensitive financial and personal information, such as Social Security numbers and bank accounts, Bradley said her family decided to have them destroyed.

News Source

Pasadena Star News, Gary Scott, Staff Writer

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