Some Hawaii-based service members may be eligible to receive compensation arising from hidden finance charges incurred in connection with their purchase of consumer electronic products through a company called Rome Finance, the state announced Tuesday. ADVERTISING Some Hawaii-based service members
Some Hawaii-based service members may be eligible to receive compensation arising from hidden finance charges incurred in connection with their purchase of consumer electronic products through a company called Rome Finance, the state announced Tuesday.
Under a July settlement agreement the Consumer Financial Protection Bureau and 13 states obtained approximately $92 million in debt relief from Colfax Capital Corporation and Culver Capital LLC, also collectively known as “Rome Finance,” for about 17,000 U.S. service members and other consumers harmed by the company’s predatory lending scheme, the state Department of Commerce and Consumer Affairs’ Office of Consumer Protection (OCP) announced Tuesday.
Rome Finance lured consumers with the promise of no money down and instant financing then masked expensive finance charges by artificially inflating the disclosed price of the consumer goods being sold. It also withheld information on billing statements and illegally collected on loans that were void. Rome Finance and two of its owners are permanently banned from consumer lending. Colfax, formerly known as Rome Finance Co. Inc., is a California consumer lending company and Culver is its wholly owned subsidiary, formerly known as Rome Finance LLC. The companies offered credit to consumers purchasing computers, video game consoles, televisions, or other products.
“This settlement underscores that predatory lending practices targeting service members and their families are reprehensible and will not be tolerated,” said OCP Executive Director Bruce Kim. “The Office of Consumer Protection welcomes this opportunity to assist the CFPB in reaching out to affected Hawaii consumers. All service members who dealt with this company should receive the relief provided for under the settlement and submit their claims to the CFPB if they believe they are eligible for compensation.”
These products were typically sold at mall kiosks near military bases with the promise of instant financing with no money down. In some cases, Rome Finance was the initial creditor, and in other cases, Rome Finance provided indirect financing by agreeing to buy the financing contracts from merchants who sold the goods.
Service members and other consumers would fill out a credit application at the kiosk and, if approved, sign financing agreements that did not accurately disclose the amounts they would have to pay for that financing. These contracts generated millions for Rome Finance while saddling consumers with expensive debt. Rome Finance has been the subject of previous state and federal enforcement actions and Colfax is currently in Chapter 7 bankruptcy.
Under the settlement, Rome Finance and its related companies can no longer collect on the financing agreements; no additional payments are required or accepted on their financing agreements; and the Bankruptcy Trustee will contact credit reporting agencies to report that each affected consumer paid in full.
Anyone who signed up with Rome Finance should immediately stop additional payments on their loan/purchase agreements and should check their credit report to make sure it was updated appropriately. Any allotment payments to Rome Finance should be cancelled.
The agreement held out the possibility that affected service members who incurred hidden finance charges might be eligible for redress through the CFPB’s Civil Penalty Fund. The CFPB recently said that $3.4 million from its Civil Penalty Fund will be allocated to fund redress payments to service members who signed financing agreements with Rome Finance. Further information on how to make a claim if a service member believes they incurred deceptive finance charges will be posted later on the CFPB website.
For further information about the settlement, click here. Current information about the status of redress payments to qualifying service members can be obtained at the CFPB’s website by clicking here.
Hawaii consumers who believe they are affected may contact the DCCA’s Office of Consumer Protection for further information or assistance by calling 586-2630 on Oahu or through the DCCA’s website by clicking here. Big Island residents can call toll-free to 974-4000, enter five digit extension code 73222.
