Acima Digital to Pay Multistate Settlement Over Deceptive Practices
Acima Digital settled a deceptive rent-to-own investigation on Thursday agreeing to pay $183.5 million across 43 states to resolve allegations that it misled consumers on rental-purchase agreements.
Tennessee secured more than $52 million in the multistate action against Acima Holdings, LLC, and its subsidiary. The state’s portion includes $805,746.26 in consumer restitution and $3,966.10 in lease balance reductions, according to an announcement from the Tennessee Attorney General’s Office.
“Companies need to do right by Tennessee consumers,” Tennessee Attorney General Jonathan Skrmetti said in a statement.
Skrmetti added that the resolution returns money to residents while forcing the finance company to alter its business methods.
Eligible residents do not need to submit forms to claim relief. The settlement administrator will reach out directly to consumers entitled to restitution, while Acima will contact individuals who qualify for lease forgiveness.
A coalition of 43 state attorneys general investigated Acima over marketing practices that promoted rental-purchase agreements as 90-day payoff programs. Investigators stated the company failed to inform buyers that they automatically entered rental terms lasting up to 12 months, which could double the advertised cash price of items like furniture and electronics.
The coalition also accused the company of using terms like credit to suggest traditional financing, hiding contract details during electronic signing, raising merchandise prices, and blocking customers from ending agreements by returning products.
Under the terms of the resolution, Acima must overhaul training for retail partners and present clear disclosures in advertisements and electronic contracts. The company must stop marking up merchandise cash prices above what retailers charge and allow consumers to return merchandise without facing obstacles.
Acima agreed to halt reporting rental-purchase agreements to the three major credit reporting agencies for five years. The company must also follow specific regulations regarding deliveries, damaged items, and repair services.
The multistate investigation drew participation from attorneys general across the country. Alongside Tennessee, the settlement includes agencies from Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.
“Our consumer protection team will keep working to protect Tennesseans from unfair and deceptive business practices and hold companies accountable,” Skrmetti said.