Here’s the kind of thing we like to hear. An auto loan servicer and debt collector will pay millions to consumers it allegedly cheated and harassed. And 128,000 people who financed a car or vehicle through a dealer and were serviced by this company will get money back.
Consumer Portfolio Services, Inc. (CPS) will pay more than $5.5 million to settle Federal Trade Commission (FTC) allegations that it overcharged these customers.
The Irvine, California company worked for auto dealers and banks all across the U.S.and it sounds like they were a nightmare for consumers.
The FTC says CPS collected money it wasn’t owed, harassed consumers, falsely threatened to repossess vehicles and told employers and family and friends about consumers’ debts. The list of alleged wrong-doing is long. Here’s what the FTC says the company did:
- Misrepresented fees consumers owed in collection calls, monthly statements, pay-off notices, and bankruptcy filings.
- Made unsubstantiated claims about the amounts consumers owed.
- Improperly assessed and collected fees or other amounts;
- Unilaterally modified contracts by, for example, increasing principal balances.
- Failed to disclose financial effects of loan extensions.
- Misrepresented that consumers must use particular payment methods requiring service fees.
- Misrepresented that the company audits verified consumer accounts balances.
CPS agreed to refund, or adjust, 128,000 accounts more than $3.5 million, and stop collections on an additional 35,000 accounts to settle the FTC’s charges. It will will pay another $2 million in civil penalties.
HOW DO YOU GET YOUR MONEY?
Refunds should go out within 90 days to people who were victimized. Others should see adjustments on their accounts in that time period. If you have a questions about your eligibility you should contact CPS directly via telephone at 1-888-806-2367, email FTCsettlement@consumerportfolio.com
