Attorney General Henry Announces $950,000 Settlement with Progressive Leasing
Unveiling the Settlement’s Details
In a resounding victory for consumer protection, Attorney General Michelle Henry proudly announced a substantial $950,000 settlement, subject to court approval, with Progressive Leasing. This Utah-based rent-to-own company faced a lawsuit filed by the Attorney General’s office in August 2022, alleging repeated violations of the Rental Purchase Agreement Act (RPAA). The lawsuit specifically cited Progressive’s failure to provide physical tags on goods offered for rent, a fundamental requirement of the act. These tags are crucial as they display comprehensive financing cost information, enabling consumers to make informed decisions before engaging in rent-to-own agreements.
Under the terms of the settlement, the Office of Attorney General will allocate $850,000 as restitution to eligible consumers who unknowingly paid significantly more than the actual price of the items they rented. Additionally, Progressive will take the responsible step of canceling the outstanding balances of 972 consumers who entered into rental purchase agreements prior to September 8, 2022.
Shining a Light on Rent-to-Own Practices
Attorney General Henry emphasized the significance of this settlement, underscoring the importance of transparency and upfront disclosures in rent-to-own transactions. She stressed that consumers must be fully aware that rent-to-own products often carry significantly higher costs compared to traditional financing options. Progressive’s failure to provide the required physical disclosures of costs associated with its products led to this settlement, holding the company accountable for its disregard of the law.
Streamlined Process for Consumers
Consumers impacted by this settlement need not take any proactive steps to receive debt cancellation or restitution. Progressive will directly contact consumers eligible for debt cancellation, while the Attorney General’s settlement administrator will reach out to those entitled to restitution.
The Evolution of the Rental Purchase Agreement Act
Prior to September 2022, the RPAA mandated that specific terms of rent-to-own transactions be disclosed to consumers through tags attached to the products offered for rent. However, an amendment to the act in September 2022 permitted businesses to provide these disclosures electronically. This change was contingent on the business confirming that the prospective lessee had viewed and acknowledged the required disclosures before presenting the rental-purchase agreement for execution.
Progressive’s Violation of the Law
Progressive offered its leases through its website and partnered with brick-and-mortar stores across Pennsylvania. The lawsuit against Progressive alleged that the company failed to provide the mandatory hang tags and neglected to instruct or require its merchant partners to display them. This omission violated the RPAA and resulted in consumers being deprived of vital information necessary for informed decision-making.
A History of Enforcement Actions
This settlement with Progressive Leasing marks the latest in a series of more than a dozen enforcement actions undertaken by the Office of Attorney General against businesses that have violated the RPAA. Notably, in May 2023, Attorney General Henry announced a significant settlement with Snap Finance, valued at $11.4 million. Additionally, in 2022, the office reached settlements with various retailers, including Ashley HomeStore, Mattress Firm, Big Lots, and others operating a total of 175 brick-and-mortar furniture stores in Pennsylvania. These enforcement actions demonstrate the Attorney General’s unwavering commitment to protecting consumers from unlawful business practices.
Reporting Unlawful Business Practices
Pennsylvanians who suspect they have been victims of unlawful business practices, whether by rent-to-own companies or any other type of business, are encouraged to file a complaint online or contact the Office of Attorney General’s Bureau of Consumer Protection via email at [email protected].
The Legal Team’s Role
The settlement with Progressive Leasing was diligently pursued by Assistant Director for Consumer Financial Protection Nicholas F. B. Smyth, with substantial contributions from Deputy Attorney General Christopher T. Dey. Their expertise and dedication played a pivotal role in achieving this favorable outcome for consumers.