A lawsuit filed by Virginia Attorney General Mark Herring against B&B Pawnbrokers Inc. in Spotsylvania, Va. alleges the business has been making illegal, unlicensed motor vehicle title loans and charging excessive fees for them. The lawsuit was filed in Richmond City Circuit Court.

In the lawsuit, Herring alleges that the business violated Virginia law by making title loans without a license between 2010 and 2015 while charging an illegal 10% monthly processing fee on all pawnbroker loans, which exceeds state limits on allowable interest rates and other charges. 

Several attempts were made in recent months to resolve the alleged violations without litigation, but without success, said Michael Kelly, a spokesman for the attorney general’s office.

Virginia has gained a reputation in recent years as the "East Coast capital of predatory lending," largely because of the actions of Virginia-based payday lenders and car title lenders, according to a March news release from the Herring’s office. The release stated that Virginia officials would start developing strategies to combat predatory lending.

Robert Barlow, the attorney representing store owner Anthony Ball, wrote in an email to The Free Lance-Star in Fredericksburg, Va., that he and Ball had been cooperating with Herring’s office and were not aware of the lawsuit until the newspaper notified them.

"B&B Pawn unequivocally denies the baseless allegations made by the Attorney General’s office. Its business practices are both fully appropriate under Virginia law and exactly the same as every other pawnbroker in the local community. It is the Attorney General’s interpretation of the law that is improper here, not the community’s local pawnbrokers,” Barlow wrote.

Barlow added that B&B Pawnbrokers support the Attorney General’s effort to combat lenders who are “profiting off the backs of working families, but in this case he is misguided, suing an entity that is in full compliance with the law and in doing so wasting valuable tax dollars taken from those same working families.”

The lawsuit is part of Herring’s revitalization of his consumer protection division and focus on combating predatory lending. It includes consumer education, enforcement action and legislative/policy work.

“Virginia cannot and will not be a haven for predatory lending and we’re working hard to fight against bad actors who seek to take advantage of Virginia consumers,” he said in a prepared statement. “Enforcement actions like this send a strong message to predatory lenders, letting them know that when they break the law, there are consequences, especially when they are profiting off the backs of working families.”


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