State Sues Title Lender Over Debt Collection Practices

West Virginia Attorney General Darrell McGraw announced Thursday that his office has filed a lawsuit against a title lender for what he said were “deceptive, unfair, and illegal debt collection practices.”

McGraw said that the suit was filed Thursday against Virginia-based Fast Auto Loans, Inc., its parent company, Community Loans of America, headquartered in Atlanta, and its owner Robert I. Reich. The lawsuit asks for a permanent injunction preventing Fast Auto from making unlawful threats of criminal prosecution and halting the company’s collection of excess charges, failure to follow the law in seizing consumers’ vehicles, and extreme methods of coercion in its debt collection process.

“Out-of-state lenders collecting debts in West Virginia will respect the rights of our citizens and the laws of our state or they will face the consequences,” McGraw said.

In response to numerous consumer complaints, an investigation by the state’s Consumer Protection Division found that Fast Auto Loans had charged 300 percent interest on loans made against car titles, repeatedly harassed and abused West Virginia consumers and their families and friends in attempt to collect debts, made false threats of arrest and criminal prosecution, and confiscated cars without a court order.

McGraw said that the majority of loans the company made in West Virginia were to residents of counties that were close to Fast Auto’s debt collection offices across the border in Virginia.

“While we cannot stop our citizens from seeking these ill-advised out-of-state loans, we can and will stop predatory lenders from abusing our citizens and violating our state’s debt collection laws,” said McGraw.

The lawsuit seeks civil penalties as well as restitution and refunds for consumers in addition to the injunction request.

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