Iowa has joined 41 other states in a settlement agreement with a Cincinnati company accused of using deceptive practices and advertising to lure consumers into paying far more to lease consumer goods than they did. Would have been given to buy them.
Iowa Attorney General Brenna Byrd announced the settlement with Tempo LLC on Monday, along with other attorneys general.
Byrd said a multi-state investigation revealed that Tempo defrauded customers into signing lease agreements for goods and services instead of purchasing them on installment plans or credit. Bird said the products covered a wide range, including mattresses, lawn and garden accessories and tires, and that the confusing terms of the arrangement resulted in consumers paying two to three times the purchase price of the products.
“No Iowan should be duped into paying three times the purchase price for a product,” he said in a news release. “Our action stops Tempo from offering these deceptive agreements in Iowa and helps those Iowans who were defrauded of their money.”
Under the terms of the agreement, all existing leases are canceled and Iowans can keep the leased products without any additional obligations to Tempo. The value of products leased from Tempo nationwide was estimated at $33 million.
The agreement states that Tempo is prohibited from any future leasing activities in Iowa and that it cannot provide negative information to credit-reporting agencies about Iowans who leased from it.
The news release said Iowans with existing leases from Tempo do not need to take any action: Tempo has automatically canceled their accounts as a result of the settlement. Tempo will pay a fine of $1 million each to the participating states and jurisdictions and the Consumer Financial Protection Bureau.