Lawyers seek class-action suit against lender

For the third time in two weeks, Spartanburg's Advance America, Cash Advance Centers, has been targeted by a lawsuit filed by South Carolina customers claiming the payday lender entrapped them in debt beyond their means to repay.

Pete Strom, former U.S. Attorney for South Carolina, has enlisted the help of a 13 trial lawyers -- including 11 state legislators from both sides of the aisle -- to seek damages from Advance America.

The suit, filed Wednesday in Georgetown by two Advance America customers, Lisa Johnson and Gilbert Herbert, alleges the lender should do more to make sure customers have a reasonable chance to repay loans.

Instead, the suit said Advance America violates state law by doing little, if anything, to check the credit worthiness of its customers.

The suit does not seek specific damages, but Strom wants the case class action to aid others who might have grievances against the payday lender.

Two other suits, filed in Horry and Spartanburg counties, make similar allegations. Two state senators were among the lawyers filing those suits.

Advance America follows all state regulations and intends to defend itself in court, company spokesman Jamie Fulmer said Wednesday. "We operate completely legally," he said.

By enlisting the help of more than a dozen state lawmakers, the suits create situations Fulmer called "awkward."

Advance America wants to work with state legislators on payday-lending issues, he said.

Lawmakers have looked at limiting the amount of fees and interest payday lenders charge.

The suit filed Wednesday alleges state law protects consumers, but Advance America does not follow the current regulations.

The suit says, "Under South Carolina law, lenders can only loan money to a borrower if the lender reasonably believes that an individual can repay the loan, given their current income and current obligations."

For Johnson, an Andrews resident, the loan she received pushed her monthly obligations to $1,812.06 -- 90 percent of her monthly income of $2,000. Based on industry research, borrowers should not have monthly debt payments greater than 55 percent of their monthly income, the suit said.

She received her latest loan worth $200 on Sept. 7, a renewal of a previous loan she could not repay in full, the suit said.

Herbert, a Clinton resident who receives $950 a month from a combination of Social Security payments and work, cannot repay the loan Advance America issued, the suit said.