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Minnesota Commerce Department fines online lender over $300,000 for illegal auto title loans

11/9/2017 10:55:23 AM

Consumers’ loans are voided and vehicle title liens will be cleared

For Immediate Release

SAINT PAUL – Minnesota Commerce Commissioner Mike Rothman announced that his agency has fined an online auto title loan company over $300,000 for illegal lending activity that charged excessive rates to Minnesota consumers. The enforcement action includes canceling the illegal loans, meaning consumers do not have to pay the current balances and the liens on their vehicle titles will be removed.

The Commerce Department’s enforcement order is directed against Autoloans, LLC, of Boca Raton, Florida, and its affiliates.

“We stopped this company’s illegal and abusive lending activities in Minnesota,” said Rothman, whose agency regulates consumer lending in the state. “Autoloans and its affiliates preyed on cash-strapped Minnesota consumers by charging predatory, triple-digit interest rates while threatening to take their cars.”

The company is ordered to pay a $302,000 civil penalty to the State of Minnesota. In addition, all of the company’s auto title loans with Minnesota consumers are void.

Rothman said that Minnesota consumers with auto title loans from Autoloans or its affiliates can stop making payments and, to protect their cars from being repossessed, they can remove the GPS tracking devices required by the company.

An auto title loan is a short-term cash loan, in which the consumer’s title to the vehicle serves as collateral. If the consumer misses payments or does not repay the loan on time, the lender can take the vehicle.  

According to the Commerce Department’s enforcement order: Autoloans and its affiliates engaged in unlicensed lending activities; made false, misleading or deceptive statements or representations about loan rates, terms and conditions; charged excessive interest rates; unlawfully repossessed six vehicles; and failed to comply with the Commerce Department’s administrative subpoena.

The Commerce Department investigated Autoloans after hearing from consumers who were concerned about excessive interest rates and who feared losing their cars to repossession.

During the investigation, Autoloans refused to comply with an administrative subpoena for information about its lending in Minnesota. But Minnesota Driver and Vehicles Services records showed at least 178 registered vehicles with liens placed by Autoloans and its affiliates. Six of these vehicles had already been repossessed.

Autoloans and its affiliates offered loans through the internet to Minnesotans. A loan required a lien on the consumer’s vehicle title and the installation of a GPS tracking device in the vehicle. Only after the lien was placed on the vehicle title and the GPS tracking device was installed did the consumer learn of the illegally high interest rates on the loan.

The annual percentage rate for the loans was as high as 247.65 percent. In one case, a $1,100 loan would have resulted in a total payment of $4,099. In another case, a $3,000 loan on which the individual had already paid almost $7,000 did not result in any decrease in the balance owed.

In general, Minnesota law limits the finance charge on these loans to 33 percent per year.

“The company’s tactics effectively forced consumers to choose between making payments on illegal, outrageously high-interest loans or having their cars repossessed,” said Rothman.

The company’s predatory lending has also occurred elsewhere in the country, and it is subject to regulatory or legal actions in at least seven other states.

The company and affiliates subject to the Commerce Department’s enforcement order include:

  • Autoloans, LLC
  • Auto Loans, LLC
  • Car Loans, LLC
  • Liquidation, LLC
  • Liquidations, LLC
  • Sovereign Lending Solutions, LLC
  • Vehicle Liquidation, LLC

The Commerce Department is notifying Minnesota consumers who have vehicle title liens placed by these entities. Consumers will be informed about the enforcement action, the cancellation of their loans and the removal of liens from their vehicle titles.

Consumers who believe they have affected loans may also contact the Commerce Department’s Consumer Services Center by email at or by phone at 651-539-1600 or 800-657-3602 (Greater Minnesota).

Consumer Tips

Rothman urges consumers to exercise caution before borrowing money through an auto title loan because it can be costly and you can lose your car. If you are considering an auto title loan, /commerce/consumers/your-vehicle/auto-title-loans.jspthe Commerce Department offers these consumer tips:

Check to confirm that the company is licensed to make auto title loans in the state. /commerce/consumers/tips-tools/license-lookup.jspUse the License Lookup tool on the Commerce Department’s website to see if the business is licensed as either an “industrial loan and thrift” or “regulated lender.”

Don’t borrow more money than you can afford to repay in the time due. How much a company is willing to lend you is not the same thing as how much you can afford to repay.

Before you take out a loan, read the contract thoroughly and be sure you understand all the terms and costs. Once you sign the loan agreement, you are legally responsible to fulfill your obligations.

Above all, consider alternatives. An auto title loan should be a last resort. If you have a short-term need for cash, try to borrow from a family member or friend, see if your employer will provide an advance on your next paycheck, find out if your bank or credit union provides short-term credit products, or ask creditors for more time to pay your bills.

Commerce is here to help

If you have a consumer protection question or believe you have been a victim of fraud, contact the Commerce Department’s Consumer Services Center by email at or by phone at 651-539-1600 or 800-657-3602 (Greater Minnesota).

Commerce is here to help
Media Contact
Ross Corson
Director of Communications
Minnesota Department of Commerce
p: 651-539-1463 | c: 651-368-5050 |



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