By Hank Russell
New York Attorney General Letitia James sued Acima Digital, Acima Holdings, and Acima Solutions (Acima) for deceiving more than 100,000 New York consumers. The Office of the Attorney General’s (OAG) lawsuit alleges that Acima violated New York’s rent-to-own law by “leasing” goods that could not be returned, charging more than the allowable amount on goods, and misleading consumers about the cost of financing provided by Acima. The lawsuit seeks to end Acima’s deceptive business practices, secure civil penalties, and collect restitution for impacted consumers.
Based on the company’s website, Acima allows customers to lease merchandise that they can later own without credit. They can shop for merchandise either on Acima’s website, its mobile app or in the store contracted with Acima. Some of the stores in contract with Acima include Bob’s Discount Furniture, P.C. Richard & Son, Best Buy and Ashley Homestore, among others.
The company claims that applicants can get approved for $300 to $5,000 of “shopping power,” without it affecting their credit score, provided they have an active checking account with at last $750 of income per month; three months of income history with the current source of income; and a form of personal identification (such as a driver’s license) and a Social Security or taxpayer identification number.
Once the applicant is approved, they can shop for eligible items, according to the website. Acima purchases the merchandise and leases it to the buyer, based on the agreement between the buyer and Acima.
According to the OAG, the self-described “virtual lease-to-own” company has operated in New York since 2015, and has entered into more than 150,000 New York transactions with more than 100,000 New Yorkers. The company does not carry an inventory of goods, but rather contracts with retail stores and e-commerce outlets to offer financing to consumers for items like furniture, eyeglasses, appliances, and tires. In 2021, Acima was acquired by Rent-A-Center but has continued to use the same business model. Consumers were led to believe that Acima’s contracts were loans or credit, but later learned these contracts were supposed leases that required consumers to pay exorbitant interest rates of 100% or higher.
As a result of this investigation, OAG filed a lawsuit that alleges Acima:
- charged consumers for merchandise that was never delivered or, when it was delivered, damaged
- debited consumers’ bank or credit card accounts after they revoked authorization to do so
- misled consumers about the cost of the financing provided by Acima
- made false threats to sue consumers and repossess their merchandise
- used the term “Acima Cash Price” to hide from consumers a markup that Acima added even before adding the usurious “rental” fees
- imposed unnecessary “processing” delays when consumers wanted to make payments, which often led to additional costs to consumers
- failed to make legally required disclosures to consumers, such as ensuring tags were attached to merchandise that revealed the cost of “leasing,” and omitting the cash price from anywhere a consumer would likely see it
- misrepresented the effect of “renting” on consumers’ credit reports
“New Yorkers shouldn’t have to worry about illegal markups or hidden terms snuck into terms and conditions by companies looking to take advantage of them,” James said. “Acima took advantage of thousands of consumers who were simply trying to shop for basic goods, like mattresses, eyeglasses, and appliances. Thousands of New Yorkers were overcharged by Acima and fooled by Acima’s deceptive lending practices. I thank everyone who came forward to make complaints about this unacceptable practice by Acima, and encourage anyone who may have been taken advantage of to contact my office.”
Long Island Life & Politics called a phone number on the website for comment, but it could not reach the corporate office.
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