AG reaches settlement with auto title loan lender

HARRISBURG, Pa. (WKBN) – Pennsylvania Attorney General Michelle Henry has an issue with auto title loan lenders. First, the interest rates are very high — in a recent case, as high as 300%. Not only are they high-interest loans, but some bad actors have been manipulating customers in the Commonwealth, she says.

Henry announced Thursday that a settlement has been reached with GPGL Holdings out of Florida. Henry said the company "pushed" borrowers into high-interest loans with Community Loans of America (CLA).

Under the settlement agreement, GPGL (which does business as Fast Money Car Title Loans) agreed to return $34,844 it received from CLA to be used for customer restitution. The company also has to pay a $10,000 penalty.

Henry said that GPGL would attract customers for CLA by setting up fake locations on Google Maps and fabricating customer reviews. When customers clicked on the fake locations, they would be directed to an online form or toll-free number, which GPGL sold to Tradition Media Group, LLC which ultimately sold the information to CLA.

CLA made thousands of unlawful loans to Pennsylvania borrowers, Henry said. In January, a $5.9 million settlement with CLA (which did business as Delaware Title Loans) regarding unlawful loans with interest rates exceeding 300 percent. The company was forced to refund customers who were victims of the scheme. It also canceled the debt and stopped taking payments on all remaining car title loans in Pennsylvania, resulting in about $3.7 million in debt cancellation.

"Out-of-state car title lenders and their affiliates should be on notice that my office will not tolerate deceptive practices to dupe Pennsylvanians into loans with exorbitant rates," Henry said. "We will fight for Pennsylvanians who are preyed upon because they are facing financial difficulties."