CarHop to pay $6.4MM for credit reporting practices

The Consumer Financial Protection Bureau announced it has filed a consent order against Interstate Auto Group, Inc., DBA "CarHop," a Minnesota "buy-here, pay-here" auto dealer, and Universal Acceptance Corporation (collectively, "CarHop"), ordering that within 20 days CarHop pay a civil money penalty of $6,465,000 to the Bureau, to be deposited in the Bureau's Civil Penalty Fund, after finding that CarHop engaged in unfair, deceptive or abusive acts and practices and violated the Fair Credit Reporting Act when they:

• Deceived consumers into believing they could build up good credit with CarHop;
• Provided inaccurate repossession information;
• Incorrectly reported previous customers as still owing money; and
• Failed to have reasonable written policies and procedures to ensure the accuracy of consumers’ credit information.

In addition to paying the civil money penalty, CarHop was ordered to:

• Cease misrepresenting that they will report “good credit”;
• Correct credit reporting information;
• Provide credit reports to harmed consumers; and
• Implement an audit program to ensure laws are followed.