Earlier today, the Consumer Financial Protection Bureau and thirteen state attorneys general released a Consent Order with Colfax Capital Corporation and Culver Capital, LLC, collectively known as “Rome Finance”, for approximately 17,000 military servicemembers and others harmed by predatory lending. This is the latest in an increasingly joint effort by state attorneys general and the CFPB to hold companies in the financial services sector responsible for harming consumers.
Rome Finance entered into financing agreements for home electronics with servicemembers and others that did not accurately disclose the amounts consumers would pay for that financing. The Consent Order reports that Rome Finance hid finance charges when marketing products, withheld required financial information from billing statements, and deceptively, unfairly, and abusively collected debt that was not owed. As a result of the CFPB enforcement action pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, Rome Finance is required to: (1) provide approximately $92 million in debt relief and cease collection of any outstanding debts; (2) update credit reporting agencies and consumers impacted by the Order with the correct debt status; (3) cease all consumer lending; and (4) cooperate with consumers who seek to vacate judgments.
The CFPB and state attorneys general will continue to pursue predatory lenders and seek redress for consumers negatively impacted. We expect to see more coordinated efforts among attorneys general and the CFPB as time goes on. To read more, see the CFPB’s Press Release.