- Associated Press - Wednesday, May 11, 2016

JACKSON, Miss. (AP) - A federal agency is suing a check cashing company to try to block what it says are deceptive practices at the company’s stores in Mississippi, Louisiana and Alabama.

The U.S. Consumer Financial Protection Bureau says All American Check Cashing Inc. instructed its own employees not to tell customers what fees they were being charged. The lawsuit also says the company overcharged some customers and didn’t repay them.

The lawsuit, filed Wednesday in U.S. District Court in Jackson, seeks to block some of the company’s practices and to force the company to pay refunds and restitution.

All American Check Cashing is based in Madison, Mississippi, and has about 50 stores in the three states. Owner Michael E. Gray did not immediately return a call seeking comment Wednesday.

Gray also owns Mid-State Finance Inc., which does business as Thrifty Check Advance with at least one store in Mississippi. Mid-State Finance is also being sued, although the lawsuit focuses on allegations about All American Check Cashing, which started operating in March 1999 in Mississippi, in July 2012 in Louisiana and in October 2013 in Alabama.

The lawsuit says All American has made more than $1 million a year in fees for cashing 12,000 to 17,000 checks annually.

In Mississippi and Alabama, the company charges 3 percent of the amount of the check to cover government-issued checks and 5 percent to cash other checks; in Louisiana, it charges 2 percent for government checks and 5 percent for other checks; and in all three states, it charges a $5 minimum fee, the lawsuit says.

All American’s policy and training documents tell employees to “never tell the customer the fee,” and the company tells employees to deflect customers’ questions about fees as long as possible and to show customers their receipts as quickly as possible, the lawsuit says.

In June 2014, the Mississippi Department of Banking and Consumer Finance ordered All American to stop some transactions such as using the proceeds from one delayed-deposit check to pay the principal or fee owed on any other delayed-deposit check. The department also ordered the company to turn over documents for regulators to investigate.

In January, All American filed a federal lawsuit seeking to block the Mississippi department from taking disciplinary action that could shut down the business. In March, a judge denied the company’s request for a temporary restraining order against the state regulators. The company’s lawsuit against the state is still pending.



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