The Consumer Financial Protection Bureau yesterday announced an enforcement action against an auto loan title lender for, among other infractions, engaging in unfair collection tactics, which will see the lender repay $2 million back to individuals who were victimized and a civil money penalty of $1.
A copy of the consent order in the case against Main Street Personal Finance, Inc., ACAC, Inc. d/b/a Approved Cash Advance, and Quik Lend, Inc. can be accessed by clicking here.
Approved Cash, which operated more than 150 stores in eight states across the country, was accused of overcharging customers $3.5 million in illegal finance charges and calling the workplaces, references, and other third parties after they had been told to stop and disclosing debts to third parties.
The lender’s policies and procedures permitted employees to make daily calls to the workplaces of customers and the references they included in their loan applications, but the policies did not specifically limit the frequency with which those calls could be made, according to the consent order. Supervisors told employees to keep making calls until they were able to get someone on the phone. In some cases, employees received warnings from supervisors for not making enough calls to workplaces and to references.
Under the terms of the consent order, Approved Cash is prohibited from making collection calls to individuals or their places of work if the individual has asked for communications to be ceased. The lender is also limit communications with third parties to only when trying to locate an individual.
The assessment of the $1 civil fine and the lowering of the amount of restitution that is to be paid was based on the lender’s financial condition, according to the consent order.
