State AGs And CFPB Stop Tempoe's Rhythm

A bipartisan coalition of 42 Attorneys General, led by Iowa, Nebraska, and Tennessee, and the Consumer Financial Protection Bureau (CFPB) announced a $35 million settlement with Tempoe LLC, a specialty consumer finance company. The multistate settlement resolves claims that the company's marketing sales practices misled consumers that they signed up for an installment plan or credit sale to purchase personal goods and services, when it fact they ended up leasing the items.

As part of its business model, Tempoe leased a variety of goods to consumers like furniture and appliances, but also goods and services that one might not normally think of in a lease – such as car parts and repairs as well as toys. The company offered their lease options after a consumer applied and was rejected for conventional financing through the retailer, and as a result the states alleged consumers were misled that they were entering into installment contracts or credit sales. States also