Davis Motor Sales banner ad

jack conway 300FRANKFORT, Ky. (7/29/14) — Attorney General Jack Conway, along with the Consumer Financial Protection Bureau and 12 other state attorneys general, announced a settlement resolving allegations that consumer lender Rome Finance, which specialized in providing consumer financing to military servicemembers, engaged in predatory lending practices that cost servicemembers tens of millions of dollars.

As a result of the settlement, 228 Kentucky servicemembers will receive $1.2 million in debt relief. In total, the nationwide settlement impacts more than 17,800 servicemembers who will receive $92 million in debt relief.

“Rome Finance targeted our servicemen and women by luring them into deceptive lending schemes with the promise of no money down and instant financing,” Attorney General Conway said. “These brave men and women work each day to protect our freedom, and the predatory actions taken by Rome Finance are unconscionable. I’m pleased that this resolution will provide military members here in Kentucky and across the country with the financial relief they are owed.”

Rome Finance, which also operated as Colfax Capital Corporation and Culver Capital, LLC, financed consumer debts primarily to servicemembers, typically for computers, gaming systems, and other goods and services from retailers online or at malls near military bases. The states and federal government allege that servicemembers were urged to purchase goods in financing agreements that hid or insufficiently disclosed extremely high rates of interest and that as a result of these financing agreements, servicemembers ultimately paid Rome Finance multiple times the retail price for the products they purchased. Payments were deducted from the servicemembers’ paychecks and were secured by access to a bank account.

The multistate lawsuit alleges multiple illegalities by the company, including failing to accurately disclose finance charges and interest rates; knowingly or recklessly assisting in the practice of financing contracts with inflated prices of goods sold; violation of the Military Lending Act for excessive interest, onerous provisions, and for requiring allotment payment backed by access to a bank account; violations of State and CFPB's unfair, deceptive, or abusive acts and practices prohibitions by financing consumer loans and/or collecting on consumer loans; and failing to provide required periodic disclosures.

Under the terms of the settlement, approved earlier this month by the U.S. Bankruptcy Court for the Northern District of California, servicemembers will keep all merchandise financed through Rome Finance, and all outstanding debts owed to the company have been erased and marked “paid in full” with consumer finance reporting agencies. In addition, today’s resolution bans new business by the company, which is no longer in operation, and its principals. Rome Finance has been the subject of previous state and federal enforcement actions and Colfax is currently in Chapter 7 bankruptcy.

Along with Attorney General Conway, participating in this national effort were the CFPB and the Attorneys General of Colorado, Delaware, Florida, Georgia, Indiana, Iowa, Massachusetts, Michigan, New York, North Carolina, Tennessee and Vermont.

Protecting Our Military Personnel

In June 2012, Attorney General Conway led a group of 20 attorneys general in securing a settlement with QuinStreet, Inc. over its operation of a website called GIBill.com. GIBill.com appeared to be a government website with information about GI Bill benefits, but it was actually a non-government related lead generator for the for-profit college industry. The settlement secured $2.5 million and transferred GIBill.com to the Department of Veterans Affairs. For more information about the settlement, click here.

You can follow Attorney General Conway on Twitter @kyoag, or visit the Attorney General’s Facebook page.

SurfKY News
Information provided by Daniel Kemp

© Copyright 2015 SurfKY News Group, Inc. All rights reserved. This material may not be published, broadcast, or rewritten without permission. SurfKY News encourages you to share this story on social media.

In Other News...

Eagles Pull off Upset Win, Return to Top in Ninth District

OWENSBORO, Ky. (3/2/15) — Apollo pulled off an upset win and returned to the top of its district with a 61-55 win over… Read More

Endowment Partners with Cheri for Free Screenings of Unique Film

MURRAY, Ky. (3/1/15) — On Thursday, March 26, audiences in Murray can attend free screenings of “Alive Inside” at Cheri… Read More

Most Read This Week

February 25, 2015 7446

Multi-Agency Investigation Nets Large-Scale Meth…

in Top News For All Sites by Trooper Stu Recke
February 24, 2015 7290

Two Charged in Central City Meth Bust

in Local (Muhlenberg) Top News by Trooper Stu Recke
February 22, 2015 7136

Easter Cuties Pageant in Memory of Shanice Bean

in Top News For All Sites Touching Hopkins by Tammy Holloway, SurfKY News
February 25, 2015 6116

New Asian Restaurant Coming to Madisonville

in Local (Hopkins) Top News by Gary Gates, SurfKY News
March 02, 2015 5239

Madisonville Teen Faces Numerous Drug Charges

in Local (Hopkins) Top News by Madisonville Police Department/Hopkins County Detention Center
February 23, 2015 5012

Fire Departments Respond to Wester's Body Shop

in Local (Muhlenberg) Top News by Shawn Freels

Most Read This Month

February 12, 2015

UPDATE: Name of Pennyrile Fatality Officially…

in Top News For All Sites Touching Hopkins by Doreen Dennis, SurfKY News
February 09, 2015

Police Pursue Man after Fight at Taco Bell

in Local (Hopkins) Top News by Madisonville Police Department/Hopkins County Detention Center

Stories Trending Today

March 02, 2015 5239

Madisonville Teen Faces Numerous Drug Charges

in Local (Hopkins) Top News by Madisonville Police Department/Hopkins County Detention Center
March 01, 2015 1715

HCCHS Student Has Unique Eye for Art

in Local (Hopkins) Top News by Amber Averitt, SurfKY News
March 01, 2015 1517

4H Penguin Plunge Draws Hundreds to Poolside

in Local (Muhlenberg) Top News by Paul McRee, SurfKY News
March 01, 2015 1155

Dave Says - March 1, 2015

in General News For All Sites by Dave Ramsey
March 01, 2015 1144

Whitfield Meets with American Financial Services…

in General News For All Sites by Robert Hankins
March 01, 2015 1115

Legislator's Log - Week of March 1, 2015

in General News For All Sites by Brent Yonts
March 01, 2015 1076

Libraries’ Drawing Contest Begins March 2

in Local (Muhlenberg) Top News by Amie Waltrip
March 01, 2015 1074

West Broadway Vendor Event, Tag Sale Planned

in Local (Hopkins) Top News by Tammy Holloway, SurfKY News
March 01, 2015 1065

Kentucky Offers Tax Credit to Small Business…

in General News For All Sites by Joe Hall
March 01, 2015 1030

Outdoor Truths - March 1, 2015

in General News For All Sites by Gary Miller