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AG Bonta Settles with Rent-A-Center for $15.5 Million Over Alleged Rental-Purchase Violations

  • California AG Rob Bonta reached a settlement with Rent-A-Center—one of the nation’s largest rent-to-own companies—to resolve allegations of systematic violations of California’s Karnette Rental-Purchase Act, Automatic Renewal Law, and consumer protection law.
  • According to the Complaint, Rent-A-Center imposed an unlawful 15% markup on the cash price of goods through its “Preferred Lease” product, which offered rent-to-own options at kiosks in traditional retail stores. Rent-A-Center also allegedly failed to provide statutorily required notices of consumers’ rights and utilized marketing material that misled consumers about their right to return purchases and the fact that the transaction was a rental rather than financing. Finally, Rent-A-Center’s “Benefits Plus” program allegedly violated certain aspects of the Automatic Renewal Law by failing to provide clear cancellation information or acquire affirmative consent.
  • Under the terms of the Stipulated Judgment, Rent-A-Center will pay $2 million in civil penalties and $13.5 million in restitution to customers, and it must create and distribute a “Know Your Rights” document to every customer and comply with relevant laws, among other things.