CHARLESTON — West Virginia Attorney General Patrick Morrisey's office has announced a multistate settlement with Tempoe resolving an investigation into the company’s advertising and leasing to consumers through retailers across the nation.
The investigation — which included 41 states and the District of Columbia — showed 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.
“Businesses should be up-front and honest about the terms and conditions of their contracts so consumers can decide for themselves if the service is right for them,” Morrisey said. “Let this be a warning to those who are using language to confuse and trick consumers: we will investigate and you will be held accountable to the full extent of the law.”
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. Additionally, Tempoe shall not provide negative information regarding lessees to any consumer reporting agency.
The amount coming to West Virginia residents is not yet clear.
Consumers with existing leases do not need to take any action as Tempoe has automatically canceled their account(s) as a result of this settlement.
Tempoe will also 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.
West Virginia joined the coalition with Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Wisconsin and the District of Columbia.