Avant, LLC, an online lending company, has agreed to settle the Federal Trade Commission’s charges that it engaged in deceptive and unfair loan servicing practices, including imposing unauthorized charges on consumers’ accounts and unlawfully requiring consumers to consent to automatic payments from their bank accounts.
According to the FTC’s complaint, Avant offers unsecured installment loans for consumers through its website. The FTC charged that in many cases, the company falsely advertised that it would accept payments by credit or debit cards, when in fact it rejected these forms of payments. The FTC also alleged that the company withdrew money from consumers’ accounts or charged their credit cards without authorization. In some instances, Avant charged consumers duplicate payments without authorization, improperly taking consumers’ monthly payments twice or more in one month. For example, one consumer’s monthly payment was debited from his account 11 times in a single day. In many cases when consumers complained about the unauthorized charges, Avant allegedly insisted that the consumers authorized the charges and refused to provide a refund.
The stipulated final order imposes a judgment of $3.85 million, which will be returned to consumers who were harmed by Avant’s unlawful practices.
Under the settlement order, Avant will be prohibited from taking unauthorized payments and from collecting payment by means of remotely created check. The company also is prohibited from misrepresenting: the methods of payment accepted for monthly payments, partial payments, payoffs, or any other purpose; the amount of payment that will be sufficient to pay off in its entirety the balance of an account; when payments will be applied or credited; or any material fact regarding payments, fees, or charges.