ATTORNEY GENERAL HERRING REACHES SETTLEMENT WITH B&B PAWNBROKERS, INC.

 ~Pawnshop agrees to offer refunds to over 840 affected borrowers in resolution of 2015 lawsuit~

RICHMOND (June 30, 2017) - Attorney General Mark Herring announced today that his office has reached a settlement with B&B Pawnbrokers, Inc. (B&B), a Fredericksburg-based pawnbroker that will offer over $60,000 in refunds to over 840 consumers as a result of the company's alleged violations of the Virginia pawnbroker statutes, the Virginia motor vehicle title loan statutes, the Virginia consumer finance statutes, and the Virginia Consumer Protection Act (VCPA).  

"In recent years we have seen a rash of pawnbrokers around Virginia skirting laws and overcharging consumers," said Attorney General Herring. "This case was the one that brought the overcharging pawnbrokers to our attention, and I am pleased that we were able to reach a fair and reasonable resolution to this lawsuit that stopped the illegal conduct, and that will put dollars back into the pockets of Virginia consumers."

The settlement resolves a lawsuit filed by Attorney General Herring in July of 2015.  In his lawsuit, he alleged that B&B violated the Virginia pawnbroker statutes by charging excessive fees in connection with its pawnbroker loan transactions, and that B&B also violated the Virginia motor vehicle title loan statutes by making non-purchase-money, motor-vehicle-secured loans without first having obtained a motor vehicle title loan license from the Virginia State Corporation Commission. Violations of the Virginia motor vehicle title loan statutes and the Virginia pawnbroker statutes also are violations of the VCPA. Finally, the Attorney General alleged that B&B violated the state's consumer finance statutes on certain loans by charging interest in excess of 12% annually on loans not covered by the Virginia pawnbroker statutes.  

The settlement includes the following key terms relating to the loans the pawnbroker made during the relevant time periods:

• B&B agrees to offer refunds totaling $58,153.83 to 843 borrowers representing the amounts those borrowers paid beyond what Virginia's pawnbroker statutes allow.  This category includes loans made between January 1, 2015 and April 30, 2016;
• B&B agrees to offer refunds totaling $3,880.00 to four borrowers (covering nineteen loans), representing full refunds of all fees paid in connection with the company's illegal motor vehicle title loans. This category of relief includes certain automobile-secured loans made between May 2012 and May 2014;
• B&B agrees to pay $2,500.00  as a civil penalty for its alleged violations of the Virginia motor vehicle title loan statutes, $11,121.25 in attorneys' fees; and
• A permanent injunction preventing B&B from violating the Virginia statutes applicable to pawnbrokers, the Virginia motor vehicle title loan statutes, the Virginia consumer finance statutes, and the VCPA.

Individual consumers who received loans from B&B during the periods referenced above and who have questions about the settlement may contact the company directly at (540) 891-8851. 

The civil settlement is in the form of a Consent Judgment filed for approval with the Richmond City Circuit Court.

This matter was handled by Attorney General Herring's Consumer Protection Section. In November, Attorney General Herring announced the completion of a reorganization of the OAG Consumer Protection Section to more efficiently and effectively enforce Virginia's consumer protection laws, provide exceptional customer service in resolving complaints and disputes, and provide robust consumer education to keep Virginians from being victimized by fraud, scams, or illegal or abusive business practices. During Attorney General Herring's administration the OAG Consumer Protection Section has recovered more than $200 million in relief for consumers and payments from violators.

If you have any consumer-related inquiries, the Office of the Attorney General's Consumer Protection Hotline telephone counselors are available to assist you with your consumer questions.  Please call the Consumer Protection Hotline at 1-800-552-9963 if calling from Virginia, or 804-786-2042 if calling from the Richmond area. You can also subscribe to the Consumer Protection Quarterly Newsletter here. 

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