On August 19, 2015, the CFPB finalized a consent order against Springstone Financial, LLC, the administrator of a healthcare financing program that offers an installment loan product (with APRs ranging from 3.99% to 17.99%) and deferred-interest loan product (with no interest if paid off during the promotional period). Springstone's products were offered to consumers by a network of healthcare providers—the healthcare offices' staff provided consumers with the applications, assisted in filling out the application, and submitted the application to Springstone for the consumer. The CFPB's consent order focuses on healthcare providers' misleading and deceptive representations regarding the deferred-interest loan product, which Springstone terminated in December 2014.
The CFPB found that the healthcare providers misled consumers about the terms and conditions of the deferred-interest loan product during the application process. The CFPB alleged that some providers described the deferred-interest loan product as a "no-interest" loan, and did not inform consumers that they would have to pay 22.98% interest if the loan was not paid in full by the end of the promotional period. The CFPB also found that the providers were trained and monitored by Springstone, and, other than the application materials, providers were the only source of additional information regarding the loan products available to consumers.
In addition to standard injunctive relief, the consent order requires Springstone to pay $700,000 to approximately 3,200 affected consumers.