On March 7, 2018, the Virginia Attorney General’s Office (“Virginia AG”) filed a complaint against two related loan companies and their owner (the “Defendants”) in Virginia state court. According to the complaint, the Defendants engage in the practice of purchasing portions of Virginia citizens’ pension payments in exchange for a lump sum, often a few thousand dollars. The Virginia AG alleges that this “purchase” is actually an installment loan disguised as a sale. The Virginia AG alleges that the finance charges associated with these loans could reach as high as 183%, despite Virginia’s 12% interest rate cap. According to the Virginia AG, the Defendants often targeted elderly veterans with military pensions or former Virginia public servants with public pensions. At least 650 Virginians with 950 loans are alleged to be affected. The lawsuit was filed under the Virginia Consumer Protection Act and seeks civil penalties, consumer relief, injunctive relief, and expenses and attorneys’ fees.
Blog Enforcement Watch May 24, 2018