Pick Your Community: | Hopkins | Muhlenberg | Daviess | Christian | Henderson | Lakes | McCracken | Webster
Davis Motor Sales banner ad

Attorney General Conway Announces Settlement Benefiting Servicemembers Harmed by Predatory Lending Scheme

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 2014 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 by using one of the social media links below.

Started 11/8/2013
Started 11/8/2013
Started 11/8/2013
Started 11/8/2013
Started 11/8/2013
Started 11/8/2013

In Other News...

CCHS Agriculture Receives Grant from DuPont Pioneer

CALLOWAY COUNTY, Ky. (10/1/14) — Agriculture students at Calloway County High School will benefit from a grant provided… Read More

Brescia University Named to Coveted Military Friendly Schools List

OWENSBORO, Ky. (10/1/14) — Victory Media Inc.'s Military Friendly Schools 2015 has recognized Brescia University among… Read More
Started 11/8/2013
Started 11/8/2013

Most Read This Week (Site-Wide)

September 29, 2014 3829

Endless Road Strings Bring Orchestra Mix to…

in Top Stories by Paul McRee, SurfKY News
October 01, 2014 3523

Muhlenberg Community Hospital to Host Lighting of…

in Top Stories by Information provided by Erin Warren
September 27, 2014 3309

Sinister on Center Takes Haunted Manor to Whole…

in Top Stories by Charles W. Riley II, SurfKY News
September 28, 2014 2703

Community Shows Support to Muhlenberg Humane…

in Top Stories by Charles W. Riley II, SurfKY News
September 29, 2014 2658

One Injured in Single-Vehicle Collision on…

in Top Stories by Rita Dukes Smith, SurfKY News Director
September 29, 2014 2557

Man, Woman Charged with Violating EPO Against…

in Top Stories by Madisonville Police Department
September 28, 2014 2467

Marching Mustangs Take Third in Ohio Competition

in Top Stories by Information provided by Shawna Hendrix
September 29, 2014 2243

Man Charged with PI, Drugs, After Allegedly…

in Top Stories by Madisonville Police Department
September 29, 2014 2239

Traffic Accident on Brown Road

in News by Madisonville Police Department
September 29, 2014 2100

Fourteen Year Old Parker Hastings Wins National…

in Top Stories by Paul McRee, SurfKY News
September 29, 2014 1809

One Injured in Two-Vehicle Collision

in Top Stories by Trooper Stu Recke

Most Read Stories from Hopkins County

September 29, 2014 2658

One Injured in Single-Vehicle Collision…

in Top Stories by Rita Dukes Smith, SurfKY News Director
September 29, 2014 2557

Man, Woman Charged with Violating EPO…

in Top Stories by Madisonville Police Department
September 29, 2014 2243

Man Charged with PI, Drugs, After…

in Top Stories by Madisonville Police Department
September 29, 2014 1680

Man Arrested for DUI, Marijuana Possession

in Top Stories by Madisonville Police Department
October 01, 2014 1548

Nephew Charged for Trespassing on Aunt's…

in Top Stories by Madisonville Police Department

Most Read Stories from Muhlenberg County

September 29, 2014 3829

Endless Road Strings Bring Orchestra Mix…

in Top Stories by Paul McRee, SurfKY News
October 01, 2014 3523

Muhlenberg Community Hospital to Host…

in Top Stories by Information provided by Erin Warren
September 28, 2014 2703

Community Shows Support to Muhlenberg…

in Top Stories by Charles W. Riley II, SurfKY News
September 28, 2014 2467

Marching Mustangs Take Third in Ohio…

in Top Stories by Information provided by Shawna Hendrix
September 29, 2014 2100

Fourteen Year Old Parker Hastings Wins…

in Top Stories by Paul McRee, SurfKY News

SurfKY News Group, Inc. Central Office & Printing Division
1125 Nebo Rd.  •  Madisonville, KY 42431  •  270.452.2249 (fax)
Main Number: 270.452.2727 (phone)  •  Printing Division Direct Line: 270.821.8600 (phone)


Contact a member of our staff: www.surfky.com/contact
Copyright © 2014 SurfKY News Group, Inc.  •  Terms of Use  •  Site Map

social 03social 04social 22social 21social 06