Blog Enforcement Watch July 21, 2015

Colorado AG Files Action Against Retailer Over Credit Extended to Military Servicemembers

On July 17, 2015, the Attorney General for the State of Colorado (“Colorado AG”) filed a lawsuit in Denver District Court alleging that a retailer and its related companies repeatedly violated Colorado’s consumer lending laws concerning credit extended to military servicemembers. ​ The action is the second lawsuit filed by the Colorado AG in the past several months against retailers allegedly targeting military families.  ​

According to the complaint, the retailer sold consumer goods and services on credit primarily to members of the military and their families.  As a result, the retailer tended to locate its stores close to large military bases, including two Air Force bases in Colorado Springs.  The complaint further noted that the retailer was previously subject to an examination that identified several issues with its credit practices, such as charging excess fees, charging improper late fees, failing to provide​ a mandatory notice of a right to cure, and extending additional credit on closed accounts without a new or refinanced loan agreement.  Although the retailer previously reached an agreement with the Colorado AG to correct many of these issues, the complaint noted that a 2014 examination revealed continuing deficiencies such as engaging in unconscionable collection practices and filing suits against Colorado-based service members in Virginia.  The complaint seeks consumer restitution, a permanent injunction from filing suits against Colorado consumers in foreign jurisdictions, and other penalties.​