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November 16, 2018

Virginia Attorney General Announces Judgment Against Pension Lender, Securing More than $50 Million in Debt Relief and Penalties

On November 15, 2018, the Virginia Attorney General’s office (“Virginia AG”) announced that it had secured more than $50 million in debt relief and civil penalties as a result of its lawsuit brought under the Virginia Consumer Protection Act against two affiliated loan companies and their owner (the “Defendants”) in Virginia state court.

According to the complaint​, the Defendants allegedly sought to purchase portions of Virginia veterans’ and retirees’ pension benefits in exchange for small lump sums, often a few thousand dollars. The Virginia AG alleged that these purchases were actually installment loans carrying a usurious rate of interest, as high as 183%, despite Virginia’s 12% interest rate cap.  Enforcement Watch previously covered this lawsuit here.

After a trial, the court ordered the Defendants to pay nearly $32 million in civil penalties, over $20 million in debt relief to affected consumers, over $414,000 in restitution, and $198,000 in costs and attorneys’ fees. Additionally, the court enjoined the Defendants from further violations of the Virginia Consumer Protection Act and declared that the Defendants’ agreements with Virginia consumers as usurious, illegal, and void.

The post Virginia Attorney General Announces Judgment Against Pension Lender, Securing More than $50 Million in Debt Relief and Penalties appeared first on Consumer Finance Insights (CFI).