Horrible stuff really. Not sure it's illegal, as CA cares more about businesses than people. Try finding an atty for consult here:
CA is one of the most consumer-friendly states in the Union. The general rule is that interest in excess of 10% per annum is usurious and may not be collected in court. There are many exceptions such as for banks, pawn-brokers and paycheck loans, but I think the max is around 36%. If they want to collect, they will have to sue in CA, so the CA limit should apply. All they can recover is the principal, no interest. You should consult a consumer attorney about it.
DISCLAIMERâ€”This answer is for informational purposes only under the AVVO system, its terms and conditions. It is not intended as specific legal advice regarding your question. The answer could be different if all the facts were known. This answer does not establish an attorney client relationship. I am admitted only in California. (Bryant) Keith Martin sbbizlaw.com