Attorney General Kathy Jennings announced a multistate settlement with Tempoe, LLC, resolving an investigation into Tempoe’s advertising and leasing to consumers through retailers.
The company reportedly shut down operations that leased furniture, appliances, and electronics.
The multistate investigation—which included 41 states and the District of Columbia—indicated 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 2-3 times the purchase price of the product or service, a release stated.
Tempoe is permanently banned from engaging in future consumer leasing activities through this settlement. 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. Additionally, Tempoe cannot provide negative information regarding lessees to any consumer reporting agency.
Consumers with existing leases do not need to take any action as Tempoe has automatically cancelled their account(s) as a result of this settlement.
Finally, 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.
”Today’s settlement underscores our commitment to protecting Delaware’s citizens, particularly the most vulnerable, from predatory lenders,” stated Jennings. “This office will continue to hold these businesses accountable.”