Rent-A-Center, now known as Upbound Group, Inc., has recently reached a settlement agreement with the Massachusetts Attorney General's Office, agreeing to pay $8.75 million to resolve allegations of abusive debt collection practices. The settlement comes after an investigation by the state's Attorney General's Office found evidence of Rent-A-Center filing criminal charges against customers as a means of debt collection, harassing consumers through debt collection calls, and engaging in other questionable practices.
The Texas-based company, which primarily rents household goods such as furniture and appliances, has faced criticism in the past for its debt collection tactics. The settlement requires Rent-A-Center to pay a substantial sum in compensation for the harm caused to consumers and to implement changes to its debt collection practices to ensure compliance with the law.
The allegations against Rent-A-Center included claims of filing criminal charges against customers who were unable to make payments on their rented items. This practice, known as "criminalization of debt," has been widely criticized as unfair and predatory. By pursuing criminal charges, Rent-A-Center was essentially using the criminal justice system as a means of enforcing its debt collection efforts, causing significant distress and harm to consumers.
In addition to the criminal charges, Rent-A-Center was accused of harassing consumers through relentless debt collection calls. Consumers reported receiving multiple calls per day, often from different numbers, creating a constant state of anxiety and intrusion into their lives. The settlement aims to address these issues by requiring Rent-A-Center to establish clear guidelines for debt collection calls and to monitor and train its employees accordingly.
The $8.75 million settlement will be used to compensate consumers who were harmed by Rent-A-Center's practices. The Massachusetts Attorney General's Office will administer the funds and distribute them to eligible consumers. In addition to the financial compensation, Rent-A-Center is also required to implement a comprehensive compliance program, hire an independent monitor to oversee its debt collection practices, and provide regular reports to the Attorney General's Office.
This settlement serves as a reminder of the importance of fair and ethical business practices, particularly in the realm of debt collection. Consumers should not be subjected to abusive tactics or unfair treatment when dealing with financial obligations. State authorities play a crucial role in holding companies accountable for their actions and ensuring that consumers are protected.
Rent-A-Center's agreement to pay the substantial settlement amount and implement changes to its debt collection practices is a step towards rectifying the harm caused to consumers. It is essential for companies to prioritize ethical conduct and treat their customers with respect and fairness.
