FirstCash, Inc., Cash America West, Inc., and First Cash Subsidiaries
On November 12, 2021, the Bureau filed a lawsuit against FirstCash, Inc. and Cash America West, Inc. On June 21, 2022, the Bureau filed an amended complaint adding 18 additional FirstCash subsidiaries as defendants in the lawsuit: FCFS AL, Inc.; Cash America East, Inc.; Cash America Inc. of Alaska; Georgia Cash America, Inc.; FCFS IN, Inc.; FCFS TN, Inc.; FCFS OH, Inc.; FCFS KY, Inc.; Cash America, Inc. of Louisiana; FCFS MO, Inc.; Cash America of Missouri, Inc.; Cash America, Inc. of North Carolina; FCFS NC, Inc.; FCFS OK, Inc.; FCFS SC, Inc.; Pawn TX, Inc.; Cash America Pawn L.P.; and Cash America Advance, Inc. FirstCash owns and operates over 1,000 retail pawnshops in the United States, offering pawn loans through its wholly owned corporate subsidiaries. The Bureau alleges that FirstCash and its subsidiaries made pawn loans to active-duty servicemembers and their dependents that violated the Military Lending Act (MLA). The MLA puts in place protections in connection with extensions of consumer credit for active-duty servicemembers and certain dependents, who are defined as “covered borrowers.” These protections include a maximum allowable annual percentage rate of 36%, known as a Military Annual Percentage Rate (MAPR), a prohibition against required arbitration, and certain mandatory loan disclosures. The Bureau alleges that between June 2017 and May 2021, FirstCash and its subsidiary Cash America West, which operates FirstCash’s pawn stores in Arizona, Nevada, Utah, and Washington, made over 3,600 pawn loans to more than 1,000 covered borrowers that violated prohibitions of the MLA by imposing a MAPR greater than the MLA’s 36% cap; using loan agreements requiring arbitration in the case of a dispute; and without making required loan disclosures. The Bureau further alleges that since October 3, 2016, FirstCash has, together with its wholly owned subsidiaries, made additional pawn loans in violation of the MLA from stores in these and other states. In 2013, the Bureau ordered Cash America International, Inc. to halt its misconduct against military families, prohibiting Cash America and its successors from violating the MLA. FirstCash is a successor to Cash America and therefore subject to the 2013 order. In this action, the Bureau alleges that FirstCash’s violations of the MLA violated the prohibitions of the Bureau’s 2013 order and consequently the Consumer Financial Protection Act of 2010. The Bureau’s complaint seeks redress for consumers, injunctive relief, and a civil money penalty.