Attorney General Formella Announces $183.5 Million Multistate Settlement with Rent-to-Own Finance Company Acima Digital, LLC

Concord, NH - Attorney General John M. Formella today announced a $183.5 million multistate settlement with Acima Digital, LLC and its direct parent company, Acima Holdings, LLC. The settlement consists of $43 million in restitution for the benefit of consumers, a $10.5 million payment to the states, and lease balance reductions totaling $130 million. Of this amount, 203 New Hampshire consumers will receive $54,770 in restitution and 224 New Hampshire consumers will receive $372,763 in lease forgiveness. The State of New Hampshire will separately receive $218,029. Acima is a rent-to-own finance company that partners with New Hampshire retailers to offer financing to New Hampshire consumers via rental-purchase agreements. The settlement resolves allegations that Acima deceptively advertised its rental-purchase agreements in a manner that misled consumers about the nature and cost of its rental-purchase agreements and deceptively marked up the cash price of the merchandise being rented, amongst other deceptive acts and practices with respect to the consummation and servicing of its rental-purchase agreements and its debt collection and credit reporting practices.

"Importantly, this settlement includes both restitution and lease forgiveness for past practices and strong injunctive relief to address practices going forward," said Attorney General Formella. "Looking forward, among other things, Acima agreed to enhanced training for retail partners who are explaining the product to consumers, restrictions on how the rent-to-own financing option is both advertised and presented to consumers, and controls on servicing for late or damaged goods or if the consumer decides to terminate the rent-to-own agreement."

The multistate coalition of forty-three (43) states alleged that Acima marketed its rental-purchase agreements as 90-day pay off programs without disclosing that consumers were automatically defaulted into the maximum 12-month term whereby consumers could pay approximately two times the cash price advertised by Acima's retail partner. Acima also advertised its rental-purchase product using terms like "credit," which often misled consumers into believing that they were obtaining traditional financing. Acima's process for electronically executing rental-purchase agreements also obscured the terms of the transaction, further compounding consumer confusion. Additionally, Acima obstructed consumers' ability to terminate their rental-purchase agreements without penalty by returning their merchandise to Acima.

Under the settlement, Acima has agreed to injunctive terms to address these practices, including but not limited to:
• Conduct robust training of its retail partners;
• Refrain from making certain representations in its advertising unless other material information is clearly and conspicuously disclosed;
• Refrain from obscuring the material terms and conditions of its rental-purchase agreements during Acima's electronic signature process;
• Refrain from marking up the cash price from that of Acima's retail partners;
• Refrain from obstructing consumers' ability to terminate their rental-purchase agreements by returning the merchandise to Acima;
• Refrain from reporting rental-purchase agreements to the big three credit reporting agencies for a period of five years;
• Properly handle late deliveries and merchandise damaged at the time of delivery; and
• Adhere to legal obligations to make repairs to merchandise during the course of the lease.

The state attorneys general that joined Attorney General Formella in today's settlement are Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Minnesota, Nebraska, New Jersey, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.

Consumers who are eligible to obtain restitution or lease forgiveness pursuant to this settlement do not need to take any action. Consumers eligible to receive restitution will be contacted by the settlement administrator. Consumers who are eligible to receive lease forgiveness will be contacted by Acima.

The Consumer Protection and Antitrust Bureau investigates unfair, deceptive or unreasonable practices involving New Hampshire consumers. You may file a complaint online at https://www.doj.nh.gov/consumer/complaints or by calling the Consumer Protection Hotline at 1-888-468-4454 for assistance.