February 15, 2005
Kansas City, Mo. — Attorney General Jay Nixon announced today that a Kansas City business will pay $50,000 for hatching a scheme that took advantage of hundreds of consumers by purporting to buy their televisions and stereos, then leasing the equipment back to them at exorbitant rates.
The business, Missouri Marketing Enterprises (MME), has agreed to comply with Missouri law and pay $50,000 to the Merchandising Practices Revolving fund. MME operated two offices in Missouri under the name Cash-2-U Leasing in Kansas City and in St. Ann, Mo. Nixon filed a lawsuit in Jackson County Circuit Court in July, alleging that the company hatched the leaseback scheme to circumvent Missouri laws governing unsecured loans.
"MME attempted to circumvent Missouri's consumer lending laws and in the process, attempted to take advantage of cash-strapped Missourians by charging exorbitant interest rates to keep their own property," Nixon said. "This agreement hopefully will put an end to those who think they can skirt the law to take advantage of Missouri citizens."
The lawsuit stated that MME ran the Cash-2-U Leasing offices without a license to operate a small loan business, failed to disclose interest rates and fees, charged accumulated interest and fees in excess of 75 percent of the initial loan amount, failed to reduce the principal amount of the loan by at least 5 percent of the original loan amount, and renewed loans more than six times — all violations of Missouri laws regarding small business loans.