Maryland Attorney General Anthony G. Brown has announced a $183.5 million multistate settlement with Acima Digital, LLC, and its parent company, Acima Holdings, LLC, over allegations of deceptive rent-to-own financing practices.
Acima partners with retailers in Maryland and other states to offer rental-purchase agreements for furniture, appliances, electronics and other merchandise.
The settlement includes $43 million in consumer restitution, $130 million in lease balance reductions and $10.5 million in payments to participating states. Eligible Maryland consumers will receive more than $1.6 million in restitution and more than $2.84 million in lease forgiveness.
According to the coalition of 43 attorneys general, Acima advertised its agreements as 90-day payoff programs without adequately disclosing that customers were automatically enrolled in agreements lasting up to 12 months. As a result, some consumers could end up paying approximately twice the advertised cash price of their purchases.
Investigators also alleged that Acima increased merchandise prices, misrepresented financing terms and made it difficult for customers to return merchandise and end their agreements.
“Acima deceptively hid the true cost of its rent-to-own transactions, then made it hard for customers to return the merchandise and stop their payments,” Brown said.
Under the settlement, Acima must change its advertising and disclosure practices, stop certain price markups, allow customers to terminate agreements by returning merchandise and refrain from reporting rental-purchase agreements to the three major credit reporting agencies for five years.
Eligible consumers do not need to take action. Those qualifying for restitution will be contacted by the settlement administrator, while customers eligible for lease forgiveness will be contacted by Acima.
