In August 2014, the CFPB filed a “consent order” against retailer USA Discounters for allegedly tricking “tens of thousands of service members” into “paying a $5 fee for legal protections” they were already entitled to. The CFPB forced the company “to pay $400,000 in refunds and penalties for deceptive charges imposed on service members” and said they could “no longer market those contracts as a benefit to troops.”

• USA Discounters “operates a chain of retail stores around the country, generally within a few miles of military bases, that sell furniture, electronics, bedding and appliances.” [Karen Jowers, “Consumer agency: ‘Fee scam’ cheated troops on financing contracts”, Military Times, 08/25/14]

• According to CFPB “Tens of thousands of service members will get restitution checks from a retailer that allegedly ‘tricked’ them into paying a $5 fee for legal protections — protections that they already have — in order to get financing, as a result of an enforcement action by the Consumer Financial Protection Bureau.” “USA Discounters charged the $5 fee on more than 70,000 contracts since 2009, generating more than $350,000 from the fees.” Because is it “likely that some customers had multiple contracts,” an exact number of victims from this scheme is unknown. USA Discounters asserted “that for the $5 fee customers were required to pay in conjunction with financing, a company called SCRA Specialists would represent them with regards to their rights under the Servicemembers’ Civil Relief Act — being available to receive lawsuits filed by USA Discounters, notifying the company of troops’ change of address, and verifying their military status to determine if they were eligible for protection under the SCRA.” The CFPB claimed “that USA Discounters misrepresented SCRA Specialists as an independent company working on behalf of troops, when its sole source of revenue was through USA Discounters.” [Karen Jowers, “Consumer agency: ‘Fee scam’ cheated troops on financing contracts”, Military Times, 08/25/14]

• The CFPB forced the company “to pay $400,000” in refunds and penalties for deceptive charges imposed on service members and “can no longer market those contracts as a benefit to troops.” [Karen Jowers, “Consumer agency: ‘Fee scam’ cheated troops on financing contracts”, Military Times, 08/25/14 and Jeff Gelles, “CFPB fines deceptive mortgage company $20M,” Philadelphia Inquirer, 08/15/14]