it is in the best interests of all of our stakeholders to settle
this lawsuit so as to avoid further expenses and management
distractions in dealing with the suit.
Gordon Reykdal, Chairman and CEO, Cash Store Financial,
Cash Store Financial, formerly Rentcash, announced
subject to court approval, it has settled a class action lawsuit
2004 for the restitution of brokerage fees and interest charged
of The Cash Store and Instaloans. The settlement is conditional
on being approved by the court.
The class action lawsuit alleges that the brokerage fees, in
with interest charged by The Cash Store and Instaloans on their
loans, constituted interest charged in excess of the maximum
by the Criminal Code of Canada.
Under the terms of the settlement, Cash Store Financial will
pay $1.5 million in cash and $1.5 million in
to customers of The Cash Store and Instaloans, outside of
British Columbia, who who
repaid a payday loan plus the brokerage fees and interest in
full. The credit vouchers may be used to pay existing
fees and interest or to pay brokerage fees and interest which
may arise in the
future through new loans advanced to the customer. The credit
fully transferable and have no expiration date. In addition, Cash
is to pay the legal fees and costs of the Class in an amount
approved by the
Gordon Reykdal, Chairman and Chief Executive Officer of Cash
Financial, stated that, "we are of the firm belief that our
business model complies with existing legislation and that our
broker fees do
not constitute interest. Nevertheless, we believe it is in the
of all of our stakeholders to settle this lawsuit so as to avoid
expenses and management distractions in dealing with the suit."
370 branches in Canada and employs 1,500.
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