WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) and the South Carolina Department of Consumer Affairs (South Carolina) today filed a lawsuit in federal district court in the District of South Carolina against Katharine Snyder, Performance Arbitrage Company, Inc., and Life Funding Options, Inc. The companies, owned and operated by Snyder, brokered contracts offering high-interest credit to veterans, many of whom are disabled, and to other consumers. The Bureau alleges that the companies and their owner violated the Consumer Financial Protection Act’s prohibition against deceptive acts or practices.
The Bureau and South Carolina specifically allege that Snyder and her companies misrepresented to consumers that the contracts the companies broker are valid and enforceable when, in fact, the contracts are void under federal and state law; misrepresented to consumers that the product is a sale of payments and not a high-interest credit offer; and failed to inform consumers of the products’ interest rates. The complaint seeks an injunction against Snyder and her companies, redress to consumers, and the imposition of a civil money penalty.
The Bureau’s investigation was conducted in partnership with South Carolina.
Today’s action builds on several of the Bureau’s past actions against other brokers to address illegal practices in the marketing or administration of high-interest credit to veterans. In January 2019, the Bureau settled with Mark Corbett, a broker of contracts offering high-interest credit to veterans. In August 2019 in partnership with the Office of Arkansas Attorney General Leslie Rutledge, the Bureau settled with Andrew Gamber; Voyager Financial Group, LLC; BAIC, Inc.; and SoBell Corp. Corbett worked with both Gamber and Snyder, and their respective companies, to broker contracts offering high-interest credit. All of these entities used similar contracts and engaged in similar marketing tactics. In each of these actions, the Bureau alleged that these contracts violate laws that prohibit these transactions and render them void, contrary to the representations made by Corbett, Gamber, Snyder, and their companies that the transactions were valid and enforceable. Additionally, the Bureau alleged that both Gamber and Snyder made similar misrepresentations to veterans including failure to disclose the interest rates for the products they broker.
The Bureau recently announced that the Civil Penalty Fund has allocated about $9 million to consumers harmed by Corbett’s actions.
The complaint is not a finding or ruling that Snyder or her companies have violated the law.
The Consumer Financial Protection Bureau (CFPB) is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit www.consumerfinance.gov.
Official news published at https://www.consumerfinance.gov/about-us/newsroom/cfpb-south-carolina-suit-high-interest-credit-offers/
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originally published at Finance - RSVTV news