Credit: Attorney General Lynn Fitch news release
Attorney General Lynn Fitch has announced a settlement with Tempoe, LLC, resolving a multi-state investigation into Tempoe’s advertising and leasing to consumers through retailers across the nation.
The multi-state investigation, which included 41 states and the District of Columbia, revealed that Tempoe’s marketing and sales practices often misled consumers to believe they were signing up for an installment plan or credit sale when, in reality, they were entering into a lease agreement. The complicated structure and the lack of required disclosures of the lease agreements caused more confusion, often resulting in consumers paying twice or three times the purchase price of the product or service.
“Misleading consumers is not only wrong and harmful to the individuals directly involved, it is also a drag on the economy overall,” said Fitch. “This settlement will prevent this kind of bad behavior by stopping Tempoe from this practice, providing a deterrent to others considering engaging in it, and helping to make whole those already impacted.”
Through this settlement, Tempoe is permanently banned from engaging in future consumer leasing activities. All existing leases will be canceled, and consumers may retain the leased merchandise in their possession without any further financial obligation to Tempoe – resulting in approximately $33 million of “in-kind” financial relief to consumers nationwide. Tempoe will not provide negative information regarding lessees to any consumer reporting agency.
Additionally, as part of this settlement, Tempoe will pay $2 million: $1 million to the states and jurisdictions participating in this settlement and $1 million to the Consumer Financial Protection Bureau, which has agreed to a parallel settlement resolving the same alleged misconduct.
Consumers with existing leases do not need to take any action as Tempoe will automatically cancel their account(s) as a result of this settlement.
Forty-one states and the District of Columbia are participating in the settlement. The multi-state Executive Committee was comprised of Nebraska, Iowa, Tennessee, Illinois, New Hampshire, Pennsylvania, and Texas, which led the multi-state group consisting of Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and the District of Columbia.