The Consumer Financial Protection Bureau has settled with Edmiston Marketing, LLC, its principal Brandon Edmiston, and USA Service Finance, LLC, for a variety of violations.
Edmiston Marketing, also called Easy Military Travel, which was located in Murray, Ky., and is no longer operating, offered and extended financing for airline tickets to military servicemembers and their families and was owned and managed by Edmiston. USASF, which is located in Mayfield, Ky., services travel-related loans, including loans made by Easy Military Travel, for servicemembers.
Easy Military Travel and Edmiston misrepresented the true cost of credit in violation of the Consumer Financial Protection Act of 2010, the bureau found. Specifically, Easy Military Travel charged a fee to consumers who obtained financing through Easy Military Travel above the fee that it charged to consumers who paid in full. Easy Military Travel failed to include that fee in the finance charge or the annual percentage rate for consumers who obtained financing, even though it was a cost of credit. Easy Military Travel representatives, at the direction of Edmiston, also quoted falsely low monthly interest rates over the telephone to consumers.
Easy Military Travel also failed to provide consumers required information about the terms of credit, such as the amount financed, in violation of the Truth in Lending Act and its implementing Regulation Z. It failed to provide consumers with the total costs of purchasing airline tickets through financing in violation of the Telemarketing Sales Rule and the total of payments in violation of TILA and Regulation Z.
Edmiston provided “substantial assistance” to Easy Military Travel’s violations of the CFPA and the TSR, the bureau said.
USASF, which serviced travel loans made by Easy Military Travel, engaged in deceptive practices in violation of the CFPA by overcharging servicemembers and their families for a debt-cancellation product for loans financing airline tickets made by Easy Military Travel and purchased and serviced by USASF.
The company also violated Regulation V, which implements the Fair Credit Reporting Act, because it never established, reviewed, or updated any written policies or procedures regarding the accuracy and integrity of the consumer information it furnished to consumer reporting agencies.
The consent order issued against Easy Military Travel and Edmiston requires restitution of $3,468,224 through a suspended judgement and a civil money penalty of only $1 due to inability to pay. Harmed consumers may be eligible for relief from the CFPB’s Civil Penalty Fund.
The consent order issued against USASF requires it to provide redress to borrowers who were overcharged for the debt-cancellation product, including paying $54,625 in restitution to borrowers with no outstanding balance on their loans and issuing additional restitution in the form of account credits to borrowers with outstanding balances. The consent order also requires USASF to pay a civil money penalty of $25,000.
The consent order prohibits USASF from collecting on or selling the travel loans purchased from Easy Military Travel. The consent order also requires USASF to establish and update reasonable written policies and procedures for the accuracy and integrity of consumer information it furnishes to consumer reporting agencies.