The Wisconsin Department of Justice says the state has reached a preliminary settlement with an auto title loan company accused of using misleading and deceptive practices against its customers. Under the deal, the Wisconsin Auto Title Loan company will pay $2.75 million in restitution to consumers, along with other penalties, for violating state consumer protection laws.
The company was accused of automatically enrolling title loan customers in a motor club, known as the “Continental Car Club.” Customers were either not told about the extra service or were falsely informed that it was mandatory.
The company has also agreed to extinguish all finance charges on open accounts and to release all existing liens issued between 1999 and 2010. The action will result in the release of about 36,000 liens.
The company operates 22 locations in Wisconsin that market and sell auto title loans.