Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AG’s have taken. Here are this week’s updates.
Tuesday, December 1, 2020
- Washington DC Attorney General Racine announced a settlement with waste disposal company Bates Trucking Co. Inc., requiring the company to pay $78,702 for illegally collecting garbage in residential neighborhoods. The company allegedly collected trash before 7:00 a.m., violating DC noise regulations, operated without a valid license, ignored enforcement notices from the Department of Consumer and Regulatory Affairs, and refused to pay fines.
- New York Attorney General James announced the adoption of final rules that modernize securities registration and filing with her Office’s Investor Protection Bureau. The press release states that these rules, which will be implemented in 2021, will “streamline and enhance the oversight of the securities industry in New York by moving filings and payments to standardized federal and multi-state systems” and that they “will better conform to the federal securities registration regime, cure industry confusion when it comes to certain registration requirements, and better track exam requirement compliance and disciplinary disclosures for thousands of investment advisers who provide investment advice to New Yorkers.”
- Several attorneys general released advisory press releases about charitable giving for Giving Tuesday, warning consumers against deceptive solicitations. California Attorney General Becerra’s, which tells consumers to take steps such as checking organizations’ registration status, being cautious of fraudulent websites, and being wary of fundraising on social network websites, is here. Texas attorney General Paxton’s, which tells consumers to research organizations, be careful when actually making the donations, and being cautious of scammers’ tricks, is here.
- A coalition of 23 attorneys general filed a comment letter asking the Department of Education to reject the Accrediting Council for Independent Colleges and Schools’ (“ACICS”) request to regain its federal recognition. The coalition is arguing that ACICS’s institutional failures and its lack of compliance with federal regulations have enabled predatory schools, like ITT Tech, to impose crushing student loan debt on students across the U.S.
- The Consumer Financial Protection Bureau (“CFPB”) filed a lawsuit against DMB Financial, LLC, a debt-settlement and debt-relief company, for allegedly violating the Telemarketing Sales Rule and the Consumer Financial Protection Act of 2010 in connection with its services. Among other things, DMB allegedly requested and received fees before it performed its services and before consumers started payments under debt settlements, as well as collected fees based on increased debt amounts after enrollment rather than the amount of debt at the time of enrollment. The CFPB’s complaint seeks injunctive relief, restitution, disgorgement, and civil penalties.
Thursday, December 3, 2020
- Arizona Attorney General Brnovich announced his office filed a lawsuit against auction companies Auction Nation, LLC and Auction Yard, LLC and their principals for allegedly deceiving online bidders by bidding in their own auctions, deceptively driving up prices when the terms and conditions assured participants that the business was not involved in the auctions. The lawsuit “seeks consumer restitution, up to $10,000 in civil penalties for each violation of the Arizona Consumer Fraud Act, injunctive relief, and attorney’s fees and costs.”
- Pennsylvania Attorney General Shapiro announced an Allegheny County Common Pleas Court order directing Vision Property Management tenants to stop paying rent and other amounts payable under their contracts because the company failed to place a portion of consumer rent money into escrow as a prior injunctive order required. The injunctive order came from allegations that Vision Properties was luring consumers into “rent to own” agreements on poorly maintained and foreclosed homes, failing to tell consumers that the agreements provided no ownership rights unless consumers exercised an overpriced option, illegally forcing consumers to make repairs to make their homes habitable, and immediately ejecting those who fell behind on payments.
- Washington DC Attorney General Racine became the 2021 President of the National Association of Attorneys General (“NAAG”) and announced his initiative to counter hate across the U.S. According to the press release, the initiative “aims to work with Attorneys General to raise awareness of hate and bias, prevent hate from taking root in our communities, support residents who have experienced hate, and develop and share best practices on improving hate crime data.”
Friday, December 4, 2020
- The FTC and the California, Illinois, North Carolina, and Ohio Attorneys General settled with Dish Network in a $210 million settlement, ending an 11-year legal dispute over the company’s alleged violation of telemarketing laws through unwanted telemarketing and robocalls, including calls to those registered on the Do Not Call registry. The settlement is here.
- New Hampshire Attorney General MacDonald announced that Camps for Grownups, LTD, a company that manages and markets adult activity camps, was indicted by the New Hampshire Multicounty Grand Jury on a felony count of violating the New Hampshire Consumer Protection Act. The company allegedly deceptively marketed a Jazz Camp as though it would occur as scheduled though the company lacked sufficient funds or a reasonable anticipated source of funding to hold the camp. If found guilty, the company could face an up to $100,000 fine.
- New Jersey Attorney General Grewal announced that New Jersey’s Bureau of Securities within the Division of Consumer Affairs issued a cease and desist order against an online investment scheme targeting LinkedIn users. The scheme, which was led by online companies VertexTrade Options, Zolarex Ltd., and IBPC Corp., allegedly violated New Jersey securities law by using fake social media profiles in order to obtain investments in fraudulent financial products. The press release also warns New Jersey residents against “investment opportunity” scams offered on social networking and dating websites.
- New York Attorney General James led a coalition of 13 attorney generals in a letter urging Congress to allocate funding and codify coverage protections so that it is guaranteed all people in the U.S. are able to obtain a COVID-19 vaccine for free.
- The Consumer Financial Protection Bureau (“CFPB”) sued online lender LendUp Loans, LLC for allegedly violating the Military Lending Act with its extensions of credit. LendUp allegedly overcharged borrowers covered by the Military Lending Act, which caps total costs at 36%, as well as failed to make the loan disclosures the Military Lending Act requires and illegally required borrowers to submit to arbitration agreements. The CFPB’s complaint, which alleges that LendUp made over 4,000 loans in violation of the Military Lending Act since 2016, seeks injunctive relief, damages, restitution, disgorgement, and civil penalties.
Sunday, December 6, 2020
- President-elect Biden has selected California Attorney General Becerra to serve as Secretary of Health and Human Services in Biden’s administration. If Becerra is confirmed, California Governor Newsom will choose a new Attorney General to fill his position until the next election.