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Attorney General Dana Nessel has announced a settlement against a company she has called a predatory online lender.
Liquidation LLC under the names Autoloans and Car Loans has sold vehicles online to Michigan customers at triple-digit interest rates, sometimes above 231% APR.
The state settled the case for $ 1.8 million.
Liquidation LLC is also not challenging 21 counts of theft under false pretenses in Kent County Circuit Court.
Two former employees of Liquidation also filed pleadings.
William McKibbin did not contest on August 10 the promotion of a pyramid promotion system, a crime of seven years. McKibbin is due to be sentenced on October 14.
Mark Weiner did not contest his participation in a pyramid promotional program on July 6. Because Weiner’s conviction was a misdemeanor, he was immediately sentenced on July 6 to jail time and three years probation.
“The criminal investigation into this case is still ongoing. However, I am grateful that this civil settlement provides compensation to the victims of a company that was seeking extreme profits by taking advantage of its customers, ”Nessel said. “Michiganers deserve to be treated fairly when financing their vehicle purchases, and lenders who do not treat consumers with this level of respect can expect consequences.”
The liquidation agreed to the following in the civil settlement:
The civil regulations include the following key terms:
- The settlement fund will provide $ 1.8 million to compensate Michigan victims of Liquidation LLC, with the claims process to be administered by the attorney general.
- The Attorney General will make all reasonable efforts to notify each Michigan victim by mail of the creation of the fund and the process for submitting a claim.
- Victims claiming compensation from the fund must submit a completed claim form and any required supporting documents to the Attorney General. Supporting documents may include proof of loan, proof of payment made to auto loans / auto loans, and vehicle information.
- Victims who make complaints will be assessed at the following levels:
- Level 1 applicant: These are applicants who have made payments below the principal amount of their loans and whose vehicles have not been taken over by Autoloans / Car Loans. Level 1 applicants will not receive payment from the fund.
- Level 2 applicant: These are applicants who have made payments totaling more than the principal amount of their loans and whose vehicles have not been taken over by Autoloans / Car Loans. Level 2 applicants are eligible for a fund payment equal to the amount the applicant has paid out of the principal. For example, if an applicant borrowed $ 1,500 and paid $ 2,000 for the loan, the applicant would be eligible to receive $ 500 from the fund.
- Level 3 applicant: These are claimants who have lost a vehicle due to repossession by Autoloans / Car Loans. Level 3 applicants are eligible for a fund payment up to the fair market value of their vehicle plus all payments made to auto loans / auto loans minus the loan principal amount. For example, if an applicant borrowed $ 1,500, paid $ 500 for the loan, and had a vehicle with a fair market value of $ 3,500 repossessed, the applicant would be eligible to receive $ 2,500 from the fund.
If you have been the victim of a liquidation, you can file a claim by calling Owen Smith at (248) 344-8554.
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