RICHMOND, Va. (Legal Newsline) — Virginia Attorney General Mark Herring announced July 25 that Alternative Finance Company, an open-end credit lender in Virginia Beach, will provide refunds and debt forgiveness to roughly 600 consumers after allegations of violating the Virginia statutes applicable to consumer finance companies and the Virginia Consumer Protection Act (VCPA).
The company purportedly imposed illegal charges on borrowers who received open-end credit loans and misrepresented on its website that it did not perform credit checks on consumers.
"Many lenders operating in Virginia have turned to open-end credit lending as a means to impose extremely high interest on small dollar loans to financially vulnerable citizens of the commonwealth,” Herring said. "My Predatory Lending Unit has dedicated its efforts, in part, to reviewing the practices of open-end credit lenders to ensure that they aren't taking advantage of Virginians and are operating in compliance with Virginia law.
"Consumers should strongly consider other available options, like a loan from a credit union, local charity or church organization, or contacting their creditors to arrange a payment plan, before resorting to dangerous open-end credit loans, where a consumer can end up paying thousands more than they originally borrowed."