CHARLESTON — West Virginia Attorney General Patrick Morrisey on Tuesday announced his office has reached a $2.4 million settlement with Virginia-based Dominion Management Services, which does business as CashPoint, to resolve allegations it engaged in a wide variety of unlawful debt collection practices.
As part of the settlement, the company has agreed to forgive more than $2.36 million in consumer loan debt, as well as release its liens on vehicle titles for 435 West Virginians, most of whom live in the eastern Panhandle. While it admitted no wrongdoing in the settlement, the company has pledged to uphold all state and federal consumer protection laws in the future.
“Our office is pleased with this settlement that will help hundreds of West Virginia consumers,” Morrisey said in a statement. “It is important to know that companies you are dealing with are fair and honest, and we take very seriously our duty to protect consumers from businesses engaging in unscrupulous practices.
"This is a win for West Virginia.”
Morrisey said his office’s Consumer Protection Division had received several complaints from consumers regarding CashPoint’s debt collection practices in recent years. Hundreds of West Virginia consumers had crossed the border into Virginia to obtain title loans from CashPoint.
Title loans involve a person using their vehicle’s title as collateral to secure a loan. While these short-term, very high-interest loans are legal in Virginia, they are prohibited in West Virginia under the state’s usury laws.
“Even though title loans are not legal in West Virginia, some citizens opt to go over state lines to obtain them,” Morrisey said. “Consumers should be cautious about getting these loans, no matter how cash-strapped they may be, because of the high interest rates and very real danger of losing their cars.”
Some CashPoint customers reported that they had endured continuously harassing phone calls, had personal debt-related information wrongly given to third-parties and had vehicles seized by companies not licensed to do business in West Virginia. While the company denied it engaged in these practices, it has agreed to refrain from them in the future.
Additionally, as part of the agreement, CashPoint pledges to:
Comply with all state and federal consumer protection laws.
Refrain from contacting consumers repeatedly or continuously by telephone with the intent to annoy or harass them.
Refrain from wrongfully disclosing a consumer’s alleged indebtedness to their employers, neighbors, relatives or other third parties.
Refrain from contacting third parties, except for the limited purpose of obtaining location information.
Refrain from employing people to seize vehicles from West Virginia residents unless those individuals or their companies are licensed to do business in West Virginia.
CashPoint also will cancel all delinquent balances that were allegedly owed as of Sept. 30, 2014. This will result in the cancellation of $2,360,189.95 allegedly owed by 435 West Virginians. The company will also release its vehicle liens and return clear titles to all 435 of those consumers. The vast majority of these consumers live in towns in the eastern Panhandle, including Martinsburg, Charles Town, Inwood, Romney, Keyser and Moorefield.
In addition, the company will pay $85,000 to the State of West Virginia, which will be used by the Attorney General’s office to promote various consumer protection programs.