News Releases

Media Bulletin - Manitoba

May 29, 2014

CONSUMER PROTECTION OFFICE ADVISES THE CASH STORE, INSTALOANS TO CEASE OFFERING BROKERED LINES OF CREDIT PRODUCTS IN MANITOBA



The Manitoba Consumer Protection Office advises that effective May 14, 2014, Cash Store Financial Services Inc. (“The Cash Store”) ceased offering customers in Manitoba any new lines of credit from third-party lenders. 

Known as brokered lines of credit, these are cash advances in which The Cash Store acted as the ‘middle man’ and arranged for third-party lenders to provide the lines of credit (a brokered line of credit).  The Cash Store earned a broker fee for each transaction.  The Cash Store began offering the brokered line-of-credit product exclusively when it stopped offering payday loans in Manitoba.

The Ontario Superior Court of Justice, through proceedings under the Companies Creditors’ Arrangement Act (CCAA), recently granted a request by the court-appointed chief restructuring officer for Cash Store Financial Services Inc. to discontinue offering these credit products.

This request was made in response to concerns raised by provincial regulators including Manitoba. 

Based on consumer complaints in this province, the Manitoba Consumer Protection Office launched an investigation that determined that Cash Store Financial Services Inc., operating as The Cash Store and Instaloans, was in violation of Manitoba’s laws including payday loan rules and loan disclosure requirements.

For further information about the CCAA proceedings regarding this company, consult the website of FTI Consulting Canada at http://cfcanada.fticonsulting.com/cashstorefinancial/default.htm.

 

- 30 -