LITTLE ROCK, Ark. (Legal Newsline) – Tri-State Pawn of Texarkana Inc. has come to an agreement with Arkansas Attorney General Leslie Rutledge, resolving allegations it charged consumers excessive interest rates on title loans, a violation of Arkansas law.
“Predatory lending practices consistently rank among the top 10 complaints made by Arkansans to the attorney general’s office,” Rutledge said. “More often than not, these unfair loans only push consumers further into debt. This pawn shop is being held accountable, and I will continue to investigate and go after those who exploit Arkansans.”
The initial complaint against Tri-State Pawn was filed back in 2013. The new consent judgment will stop the company from collecting from consumers on auto pawns or title loans. All outstanding auto pawns or title loans will be voided. The company will pay $8,697 that will be distributed to victims and $108,000 that will be deposited into the Consumer Education and Enforcement Fund.
Title pawns, another name for auto-title loans, are short-term, high-interest loans where the buyer gives the title and key to the lender as collateral. The borrower, however, retains possession of the car, and gets the title back once they complete payments.