Rent-A-Center accused of illegal dealings in Washington
SEATTLE -- The nation's largest rent-to-own company, a growing business in the recession, has been accused of illegal collection practices in Washington state, including harassing customers with profanity during collection calls and scaring children by telling them that their parents would be jailed.
The lawsuit filed Friday by Washington state Attorney General Rob McKenna includes allegations from 10 individuals who also allege that employees tried to break down a door and told third parties that their neighbors had written the company bad checks.
For years, Karen Lyons was a happy Rent-A-Center customer.
The Federal Way grandmother got her big-screen TV, her bedroom set and other furniture from the store.
She knew she was paying more - a lot more - than buying at a store. But she says, it was the only way she could afford these things.
Late last year, Lyons was a day late on her payment. She says she made arrangements with her local store to pay the next day.
Then came that knock on the door.
The Rent-A-Center employee wanted full payment on the spot or all the furniture back.
"And I'm like, 'No, you're not coming in my house to get my furniture,'" she said. "(I said) II'm almost through paying on this and you want to come to my house and act like this?'"
Lyons says the Rent-A-Center employee was rude, disrespectful and threatening. Her 6-year old grandson, Jermaine, was standing right there.
"She told her that she was going to take her to jail and then they were going to take me to CPS, " said the boy. "and I started crying."
And it appears Lyons was the only victim.
Carol Hammons of Everett wrote that she stopped making payments after finding a sofa, recliner and a hide-a-bed she rented in August 2006 had torn fabric and a broken leg and the recliner didn't work. Two Rent-A-Center employees came to her home while two neighbor girls were babysitting her 11-year-old autistic daughter and told the girls she would be jailed for theft, she asserted.
Sylvia Carr wrote that while working at a customer call center in Tukwila in June 2008, she agreed to be a reference for a fellow worker, then lost track of the co-worker after finding another another job. She accused Rent-A-Center employees of pestering her with dozens of calls about the former co-worker, starting the next month, including repeated calls to the home of her elderly in-laws.
"While companies certainly have the right to collect on outstanding debts, state law, along with the most basic standards of common courtesy, dictates how companies may collect on those debts," McKenna said in a news release. "Attempting to kick doors down, calling the debtor's friends and relatives and scaring their children aren't included in those basic standards."
McKenna's action, which seeks $2,000 per violation of state laws on lease-purchase agreements, deceptive practices and unfair practices, is a countersuit in response to Rent-A-Center's efforts to block a January 2008 investigative order by the state. At that time, the state had sought information from the company in Clark County Superior Court in Vancouver while investigating consumer complaints.
A year later, after the case was moved to Seattle, a judge required the company to grant three categories of the request and rejected state demands in three other categories, including lists of past and present employees.
A spokesman for Rent-A-Center claims the Attorney General's charges are "patently false," and claims they will be proven to be untrue.
"We stand by our collections and we stand by our product. We feel like we're making life manageable for everyday Americans," said Xavier Dominicis, vice president of Rent-A-Center.
The rent-to-own industry, estimated at more than $6 billion a year, has fared better than most businesses during the recession. Rent-A-Center, the largest, reported a 2.3 percent increase in same-store sales in 2008. No. 2 Aaron's, based in Atlanta, recorded an 18 percent increase and has announced plans to open another 200 stores in the next year.
Rent-A-Center has settled at least two lawsuits in other states in recent years.
A class-action lawsuit in New Jersey accusing the company of charging excessive interest under usury laws was resolved in 2007 after the company paid about $109 million into a settlement fund. After the California attorney general's office sued under a statute with tougher disclosure and enforcement provisions than the Washington state lease-to-own law, the company agreed to make about $7 million in restitution and other payments in 2006.
For more information:
Rent-A-Center accused of harassing, deceiving customers
The lawsuit filed Friday by Washington state Attorney General Rob McKenna includes allegations from 10 individuals who also allege that employees tried to break down a door and told third parties that their neighbors had written the company bad checks.
For years, Karen Lyons was a happy Rent-A-Center customer.
The Federal Way grandmother got her big-screen TV, her bedroom set and other furniture from the store.
She knew she was paying more - a lot more - than buying at a store. But she says, it was the only way she could afford these things.
Late last year, Lyons was a day late on her payment. She says she made arrangements with her local store to pay the next day.
Then came that knock on the door.
The Rent-A-Center employee wanted full payment on the spot or all the furniture back.
"And I'm like, 'No, you're not coming in my house to get my furniture,'" she said. "(I said) II'm almost through paying on this and you want to come to my house and act like this?'"
Lyons says the Rent-A-Center employee was rude, disrespectful and threatening. Her 6-year old grandson, Jermaine, was standing right there.
"She told her that she was going to take her to jail and then they were going to take me to CPS, " said the boy. "and I started crying."
And it appears Lyons was the only victim.
Carol Hammons of Everett wrote that she stopped making payments after finding a sofa, recliner and a hide-a-bed she rented in August 2006 had torn fabric and a broken leg and the recliner didn't work. Two Rent-A-Center employees came to her home while two neighbor girls were babysitting her 11-year-old autistic daughter and told the girls she would be jailed for theft, she asserted.
Sylvia Carr wrote that while working at a customer call center in Tukwila in June 2008, she agreed to be a reference for a fellow worker, then lost track of the co-worker after finding another another job. She accused Rent-A-Center employees of pestering her with dozens of calls about the former co-worker, starting the next month, including repeated calls to the home of her elderly in-laws.
"While companies certainly have the right to collect on outstanding debts, state law, along with the most basic standards of common courtesy, dictates how companies may collect on those debts," McKenna said in a news release. "Attempting to kick doors down, calling the debtor's friends and relatives and scaring their children aren't included in those basic standards."
McKenna's action, which seeks $2,000 per violation of state laws on lease-purchase agreements, deceptive practices and unfair practices, is a countersuit in response to Rent-A-Center's efforts to block a January 2008 investigative order by the state. At that time, the state had sought information from the company in Clark County Superior Court in Vancouver while investigating consumer complaints.
A year later, after the case was moved to Seattle, a judge required the company to grant three categories of the request and rejected state demands in three other categories, including lists of past and present employees.
A spokesman for Rent-A-Center claims the Attorney General's charges are "patently false," and claims they will be proven to be untrue.
"We stand by our collections and we stand by our product. We feel like we're making life manageable for everyday Americans," said Xavier Dominicis, vice president of Rent-A-Center.
The rent-to-own industry, estimated at more than $6 billion a year, has fared better than most businesses during the recession. Rent-A-Center, the largest, reported a 2.3 percent increase in same-store sales in 2008. No. 2 Aaron's, based in Atlanta, recorded an 18 percent increase and has announced plans to open another 200 stores in the next year.
Rent-A-Center has settled at least two lawsuits in other states in recent years.
A class-action lawsuit in New Jersey accusing the company of charging excessive interest under usury laws was resolved in 2007 after the company paid about $109 million into a settlement fund. After the California attorney general's office sued under a statute with tougher disclosure and enforcement provisions than the Washington state lease-to-own law, the company agreed to make about $7 million in restitution and other payments in 2006.
For more information:
Rent-A-Center accused of harassing, deceiving customers