The Consumer Financial Protection Bureau (CFPB) is fining the parent company of TitleMax, a title loan lender, $9 million for luring consumers into costly loan renewals with misleading information about terms and costs, The Hill reported today. The agency said yesterday that the company, which offers loans in exchange for a customer’s car title, also used debt collection tactics that illegally exposed information about debts to borrowers’ employers, friends and family. “TMX Finance lured consumers into more expensive loans with information that hid the true costs of the deal,” CFPB Director Richard Cordray said in a statement. "They then followed up with intrusive visits to homes and workplaces that put consumers’ personal information at risk.” The CFPB said it found store employees, as part of their sales pitch for a 30-day loan, were offering consumers a “monthly option” for making loan payments and giving out a “Voluntary Payback Guide” that showed how to repay the loan with smaller payments over a longer time period. However, the guide and sales pitch neglected to explain the true cost of the loan if the consumer renewed it multiple times.
