Posted on 08/03/2015 10:40:26 AM PDT by Brad from Tennessee
For a very fat fee, South Florida check-cashing businesses have routinely turned a blind eye to criminals who use fake IDs to cash millions of dollars in fraudulently obtained tax-refund checks from the U.S. Treasury Department, authorities say.
Case in point: A Homestead-area man convicted of cashing thousands of fraudulent tax-refund checks totaling $12 million.
Now, the government hopes to put an end to the racket by requiring 760 check cashers in Miami-Dade and Broward counties to obtain additional personal information from all customers if they want to cash a refund check in excess of $1,000.
The check-cashing crackdown — which takes effect Monday and is the first in the nation — aims to help the Internal Revenue Service punish bad businesses and save taxpayers millions. It’s being imposed during the off-tax season because that is when criminals often try to cash ill-gotten refund checks issued in other people’s stolen names.
“We are putting the check cashers on notice that if they continue to do this, they will be prosecuted,” said Kelly Jackson, special agent in charge of IRS criminal investigations in South Florida. “We hope to stop the bad people and put them in jail and protect tax revenue.”
Among the new requirements: a copy of the customer’s identification, such as a driver’s license or passport, matching the name on the refund check. Also required: a digital photo taken of the customer at the time of the transaction that matches the one on the ID and the customer’s phone number.
Already required under state law: the customer’s thumbprint recorded on the check. . .
(Excerpt) Read more at miamiherald.com ...
Could be...but for some...the check cashing places are worse
These check cashing places charge a modest interest rate for the first 13 days of the loan. After that, the interest rate goes to an average of 197%. In some cases it goes as high as 450%.
Most people get a paycheck every 14 days. For people living from paycheck to paycheck, that's a severe hit to pay off the loan on day 14.
Shouldn’t it be up to the people to make that decision?
“What is your beef? That check cashers have to produce an ID?”
Yes. It’s racist just like having to produce an ID to vote, get a library card, etc.
Oh, but it is. The IRS will stop direct deposit after the 3rd return for a given address but will continue to mail refund checks for the other 5,000 people living there. It's true, look it up.
IMPEACH KOSKINEN NOW!
It’s a political slam dunk.
"I'm lawless, and I vote"
...just to remind the democRATs to tread carefully.
That’s just a big old demonstrably false lie!
It’s pretty stupid to “cash” a legitimate paycheck at a payday lender.
Straight up 6% instant service charge.
Floating a 14-21 day paycheck advance is a straight up 10% plus $1.00.
That whole 197% “average” canard is false.
Odd thing, one never gets any credit points for paying off such loans on time or early...
If you want to borrow $300 from a payday lender, you pay a fee, usually $20 per $100 that you borrow. So you write a check to the payday lender for $360.
At the end of the two weeks, if you're like most people, you have to roll the loan over and pay another $60. Again, as I posted earlier, a very narrow segment of such customers. The $120 you pay to borrow $300 for one month translates into a 520% annual percentage rate (APR).
The annual percentage rate is calculated on the cost of rolling the loan over every two weeks, for a year.
Here are the rates advertised by one such place.
That’s not how it works.
If you want a short term payday cash loan, it’s 10% plus $1.00.
So for $300.00, the interest and fees for an instant $300.00 loan is $31.00.(that’s $1.00 less than a single bounced bank check fee, and there is no criminal intent/exposure to commit fraud charges involved)
You write the check to the lender for $331.00.
That’s a simple 10% and a $1.00 fee.
You walk in on or before the due date, pay the fees, and get your check back.
It’s a high interest rate, but again, it beats a single bounced check fee charge, and is a more rational choice of financing options for those with no credit or bad credit, when either an accounting error or simple emergency expenses threatens to make a small cash flow problem into a life changing event.
Most people don’t “roll it over” even once.
That is frowned upon, and lowers your chances of getting another advance.Just like “real banks” do, if you don’t pay on time.
One might need to take out subsequent advances, generally of smaller amounts, if it takes a few months to get back on budget.
Still beats escalating late payment fees and/or bounced check fees.
The APR numbers you site are entirely irrelevant at this level.
Yes. In that instance, you are correct.
For my example, I was speaking specifically about people who roll over the loan for longer than the initial short term. In that case, the usury interest rates kick in.
Sigh....
I am also correct in stating the 10% plus $1.00 is the customary fee.
Not 20%, and not the worst case scenario of an absolute idiot who had no intent to pay the financed amount on time, in the first place.
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