First Investors Fined $2.75 Million for Knowingly Providing Inaccurate Information to Credit Reporting Agencies for Years WASHINGTON, D.C. — Today the Consumer Financial Protection Bureau (CFPB) is taking action against an auto finance company that distorted consumer credit records for years. Texas-based First Investors Financial Services Group Inc., which lends primarily to subprime borrowers, failed […]
WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau (CFPB) took enforcement action against ACE Cash Express, one of the largest payday lenders in the United States, for pushing payday borrowers into a cycle of debt. The CFPB found that ACE used illegal debt collection tactics – including harassment and false threats of lawsuits or criminal prosecution – to pressure overdue borrowers into taking out additional loans they could not afford. ACE will provide $5 million in refunds and pay a $5 million penalty for these violations.
The Consumer Financial Protection Bureau is the nation’s first federal agency with the sole focus of protecting consumers in the financial marketplace. Financial products like mortgages, credit cards, and student loans involve some of the most important financial transactions in people’s lives. In the Dodd-Frank Act, Congress created the Bureau to stand on the side of consumers and ensure they are treated fairly in the consumer financial marketplace. Since we opened our doors, we have been focused on making consumer financial markets work better for the American people, the honest businesses that serve them, and the economy as a whole.
The CFPB alleges that the company violated the rule with its quarterly bonus program, which paid more than 150 Castle & Cooke loan officers greater bonus compensation when they persuaded consumers to take on more expensive loans.
The rule creates a transparent process for allocating money from the Bureau’s Civil Penalty Fund to compensate victims harmed by a person or company that was fined in an enforcement action brought by the Bureau.
