WASHINGTON–The CFPB has sued five title lenders operating in Arizona for failing to disclose the annual percentage rate in online advertisements about title loans.
The Bureau alleges that the companies—Auto Cash Leasing, LLC; Interstate Lending, LLC; Oasis Title Loans, LLC; Phoenix Title Loans, LLC; and Presto Auto Loans, Inc.—advertised a periodic interest rate for their loans without listing the corresponding annual percentage rate.
The CFPB filed five individual administrative lawsuits seeking civil monetary penalties and administrative orders requiring the companies to correct their practices.
Auto Cash Leasing, LLC, formed in 1999, Interstate Lending, LLC, formed in 2005, Oasis Title Loans, LLC, formed in 2013, Phoenix Title Loans, formed in 2013, and Presto Auto Loans, Inc., formed in 2002, all offer vehicle title loans to consumers. All five lenders were formed in Arizona, operate in Arizona, and market their services to consumers online.
From at least July 6, 2016, the CFPB alleges that the five lenders violated the Truth in Lending Act by advertising loan interest rates on their websites without advertising a corresponding annual percentage rate. For example, one lender advertised on its website a monthly interest rate but failed to include the legally required annual percentage rate for the loan, the CFPB said. In its online advertisement, another lender asked consumers to take its advertised rate and multiply it by 12, but did not inform consumers that the calculated number is the annual percentage rate.