The CFPB and the State of Arkansas proposed a settlement in the United States District Court, Eastern District of Arkansas, against brokers for violations of the Consumer Financial Protection Act of 2010 and the Arkansas Deceptive Trade Practices Act. The violations were related to misrepresentations of high-interest credit offers.
According to the CFPB, Andrew Gamber, and several entities he operated, made high-interest offers on credit to consumers and, in particular, to disabled veterans. The CFPB found that Mr. Gamber falsely claimed that (i) the offered product was a sale of payments when it was actually a high-interest credit offer, and (ii) consumers would receive funds during a specified timeframe. In addition, the CFPB stated that Mr. Gamber did not inform consumers of the interest rate on the credit offer.
Under the CFPB's proposed settlement, Mr. Gamber and his companies would be permanently banned from engaging in any activity in relation to brokering agreements between pension recipients and third parties. The CFPB also imposed (i) a $2.7 million judgment of redress, (ii) a $1 civil money penalty to the CFPB, and (iii) $75,000 to the Arkansas Attorney General's Consumer Education and Enforcement Fund instead of a civil money penalty to the State of Arkansas. However, the CFPB stated that if Mr. Gamber pays $200,000 in consumer redress, the $1 civil money penalty to the CFPB and $75,000 to the State of Arkansas, then the CFPB will suspend the full payment of the $2.7 million judgment for redress.
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