An All American Check Cashing store in Magee, Miss. Credit: Google Maps

A Madison-based payday lender and title loan will have to pay more than $1 million in fines and have all their licenses revoked under an agreement reached with state banking regulators.

The Mississippi Department of Banking and Consumer Finance announced the settlement with three companies — All American Check Cashing, Midstate Finance and All American Title Loans — after state officials determined the companies had violated state law.

The violations included knowingly accepting fee-only payments from customers, using proceeds from one loan to pay off other loans and, setting up ways to make loans to customers who get paid once per month and making loans to people without open, active bank accounts, all of which state law prohibit.

A fact sheet on payday loans in Mississippi states that “it is illegal to renew, extend or rollover your payday loan by just paying the fee. The payday loan must be completely paid in full before you can enter into another payday loan transaction” and encourages customers to report lenders that suggest paying just the fee.

State law also caps the amount borrowers can hold in payday loan debt at $500 at one time. Dale Danks, an attorney who has been representing the companies, all owned by businessman Michael Gray, did not return a phone message left with his office.

Before the agreement, Gray held 75 licenses for more than 40 lending businesses in Mississippi; the companies also have locations in Louisiana and Alabama. Those licences will be revoked and the companies will pay $889,350 in civil penalties and $134,609 in refunds to customers.

Charles O. Lee, director of consumer protection at the nonprofit Mississippi Center for Justice, which advocates for payday-lending reform, said the settlement shows that regulatory agencies are doing what they should to protect consumers.

“We want consumers to know they’re not out there by themselves,” Lee said. “In so many ways, consumers are the ones who get the worst part of the deal.”

The federal Consumer Financial Protection Bureau filed a separate lawsuit against All American in May 2016, alleging the companies engage in deceptive lending practices. That lawsuit is ongoing in federal court in Jackson.


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Ryan L. Nave, a native of University City, Mo., served as Mississippi Today's editor-in-chief from May 2018 until April 2020. Ryan began his career with Mississippi Today February 2016 as an original member of the editorial team. He became news editor August 2016. Ryan has a bachelor’s in political science from the University of Missouri-Columbia and has worked for Illinois Times and served as news editor for the Jackson Free Press.