Today, the Consumer Financial Protection Bureau (Bureau) and the Arkansas Attorney General settled with Alder Holdings, LLC (Alder), resolving their allegations that Alder failed to provide proper notices under the Fair Credit Reporting Act (FCRA). Alder is a Utah-based company that sells home-security and alarm systems, primarily door-to-door, throughout the country and has sold its products and services to over 115,000 customers. The Bureau and Arkansas filed a proposed stipulated final judgment and order in the United States District Court for the Eastern District of Arkansas. If entered by the court, the settlement would require Alder to pay a $600,000 civil money penalty, $100,000 of which will be offset if Alder pays that amount to settle related litigation with the State of Arkansas that is currently pending in state court in Arkansas. The settlement would also require Alder to provide proper notices under FCRA.
The FCRA and its implementing regulation, Regulation V, require companies to give consumers notice when the companies provide consumers with less favorable credit terms based on a review of their credit reports—also known as risk-based pricing. The complaint alleged that Alder, in extending credit to its customers for its home-alarm products and services, charged customers who had lower credit scores higher activation fees, but failed to provide those customers with the required risk-based pricing notice. Arkansas also alleged that Alder violated the Consumer Financial Protection Act of 2010.
The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.
This news item was originally published by the Consumer Financial Protection Bureau (CFPB US). For more information, please see the Source Link.