HARRISBURG, PA – Pennsylvania Attorney General Michelle Henry announced on Monday a settlement with Snap Finance LLC and its affiliates amounting to $11.4 million.
The settlement follows allegations that the lending company exploited low-income Pennsylvanians, offering misleading terms for large purchases. The suit claimed that the company presented one-year rent-to-own agreements as “100-Day Cash Payoffs”, and engaged in deceptive collection practices.
Snap Finance, along with its affiliates Snap RTO LLC, Snap Second Look LLC, and Snap Finance Holdings, LLC, were accused of using a web-based portal to allow retailers to fraudulently sign agreements on behalf of consumers.
According to the settlement, $7,300,000 will be awarded to consumers as cash restitution payments and another $3,150,000 will be provided as consumer debt relief. The remaining balance of the settlement amount will cover civil penalties and costs incurred by the Office of Attorney General.
Attorney General Henry noted that Snap Finance deceived consumers about the nature of the contracts, advertising their agreements as “100-Day Cash Payoffs” but in reality, consumers were signing onto 12-month agreements with leasing fees equivalent to a 152% APR interest.
The Consent Petition was filed in the Court of Common Pleas of Philadelphia County last Friday and is currently awaiting the Court’s approval.
The case was litigated by Assistant Director Jill Ambrose and Deputy Attorney General Christopher Dey with assistance from Senior Civil Investigators Melissa Ritzman and Alison Calderone.