Arizona AG Kris Mayes announces $35M settlement with leasing company for deceptive practices
Sep 12, 2023, 4:35 AM
(Getty Images File Photo)
PHOENIX — Arizona Attorney General Kris Mayes announced Monday a $35 million settlement has been reached with a leasing company Tempoe, LLC.
The settlement resolves a multistate investigation into Tempoe’s advertising and leasing practices through retailers across the nation, the attorney general’s office said.
An investigation by 41 states and the District of Columbia revealed Tempoe often led consumers to believe they were signing up for an installment plan or credit sale. However, they were entering into a lease.
The office said the lease agreement’s complicated structure and the lack of required disclosures, caused even more confusion. This resulted in consumers paying two to three times the original purchase price of the product.
Mayes expressed that she will continue to hold companies accountable for any financial bate and switch that affects consumers.
“Our office is committed to protecting all consumers, including individuals with low credit scores, from unscrupulous business practices that harm financially vulnerable consumers,” Mayes said in a press release.
What’s included in the settlement?
As a result of the settlement, Tempoe is permanently banned from engaging in any future consumer leasing activities. The company will cancel all existing leases and consumers can keep the leased merchandise without paying any additional amounts.
There will be $33 million of debt forgiveness for consumers nationwide.
The company cannot provide negative credit information regarding lessees to any consumer reporting agency.
Tempoe canceled accounts for customers with existing leases and they do not have to take any action.
The company will pay $2 million. It will be divided equally, with $1 million going to the jurisdictions involved in the settlement and $1 million to the Consumer Financial Protection Bureau, which has also reached a parallel federal settlement addressing the same issues.
Senior Litigation Counsel Alyse Meislik handled the case.