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For Immediate Release

Media Contact:
Raquel Guillory, 410-576-6357
rguillory@oag.state.md.us

Attorney General Settles with Maryland Company
Making Payday Loans
Recovers More Than $3.2 Million; Company Operated as a Ponzi Scheme

BALTIMORE, MD (December 13, 2007) - Attorney General Douglas F. Gansler announced today that the Securities Commissioner has reached a settlement with First Cash Express, Inc. and its owner Alvin Ambrose. The Commissioner found that First Cash Express and Ambrose violated the antifraud provisions of the Maryland Securities Act by misrepresenting the company’s history and legal status, and failing to explain the risks associated with an investment in First Cash Express, Inc. and that it had no operating profits. A copy of the Consent Order is available on the Attorney General’s website, at http://www.oag.state.md.us/Securities/Actions/index.htm.

“The Securities Division’s investigation and enforcement action protected the investors’ assets,” said Attorney General Gansler, “While this action will lead to a substantial recovery of investors’ funds, it is critical that investors understand the risks they face when they invest with insufficient information.”

First Cash Express advertised its investment program over the internet and by word of mouth. The company raised more than $5 million from about 180 investors and promised to pay investors 15% interest every month from profits it claimed to earn on loans made at high interest rates. In fact, First Cash Express lent only about $260,000 to payday borrowers who repaid approximately $135,179. The approximately $800,000 in interest that First Cash Express paid its investors was almost entirely funded with money from new investors rather than interest earned from the payday loan program.

As part of the settlement, First Cash Express turned over to the Office of the Attorney General approximately $3,279,544 and Ambrose promised to turn over any future profits from the sale of real estate that he owns. All funds will be distributed to investors, taking into account any interest and other payments that investors may have received.

Attorney General Gansler reminds investors that interest payments made to earlier investors are not a sign of a viable investment program. Investors can contact the Securities Division of the Attorney General’s Office at 410-576-6360 if they have questions concerning investment promoters and the investment opportunities they offer. Gansler also cautions potential investors to thoroughly check out any securities professionals with whom they are considering investing, including securities broker-dealers, agents, investment advisors, investment advisor representatives, financial planners, the registration status of securities, and to report suspected fraud.

   

Attorney General of Maryland 1 (888) 743-0023 toll-free / TDD: (410) 576-6372
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