A little mentioned news story in Stars and Stripes tells the tales of woe of a number of less than brilliant service members who were “duped” into buying things at they neither needed nor wanted at grossly inflated prices with the promise of “easy credit”:
Army Spc. Angel Aguirre needed a washer and dryer.
Money was tight, and neither Aguirre, 21, nor his wife had much credit history as they settled into life at Fort Carson in Colorado in 2010.
That’s when he saw an ad for USA Discounters, guaranteeing loan approval for servicemembers. In military newspapers and magazines, on the radio, and on TV, the Virginia-based company’s ads shout, “NO CREDIT? NEED CREDIT? NO PROBLEM!” The store was only a few miles from Fort Carson.
“We ended up getting a computer, a TV, a ring, and a washer and dryer,” Aguirre said. “The only thing I really wanted was a washer and dryer.”
Aguirre later learned that USA Discounters’ easy lending has a flip side. Should customers fall behind, the company transforms into an efficient collection operation. And this part of its business takes place not where customers bought their appliances, but in two local courthouses just a short drive from the company’s Virginia Beach headquarters.
From there, USA Discounters files lawsuits against servicemembers based anywhere in the world, no matter how much inconvenience or expense they would incur to attend a Virginia court date. Since 2006, the company has filed more than 13,470 suits and almost always wins, records show.
The article goes on to state that they are by far the largest recipient of default judgments against servicemembers:
As of January 2014, 230 servicemembers were involuntarily paying USA Discounters a portion of their pay, Department of Defense data shows. Altogether, those servicemembers have paid more than $1.4 million to the company.
Next on the list of most active creditors were the two other local companies, Military Credit Services and Freedom, which together had seized the pay of 92 servicemembers for a total of $289,000 as of January, according to the data.
The company did make a statement for the original story:
Timothy Dorsey, vice president of USA Discounters, said the company provides credit to servicemembers who would not otherwise qualify and sues only after other attempts to resolve debts have failed.
As for the company’s choice of court, he said it was “for the customer’s benefit.” In Virginia, the company isn’t required to use a lawyer to file suit. USA Discounters’ savings on legal fees are passed on to the customer, he said.
Now if you’re wondering if that name rings a bell, you’re not alone. Jonn and Hondo reported on Mr. Dorsey here and here.
Yeah. THAT Timothy Dorsey. And he also serves as general counsel, which is to say, the legal face of USA Discounters. Normally, I’m not all that sympathetic to young troops who do stupid things like buy things they can’t afford on credit terms that are less than favorable, particularly when they, you, I, and everyone else who has put on a uniform, has attended seemingly endless lectures on the pitfalls of “easy credit” and the eagerness with which businesses near any major military base exist solely to separate said dumbasses from their pay. Even 30 years after the fact, I can still picture the 22nd Street entrance of NTC Great Lakes, with all their shiny baubles and toys, well out of my reach but for a signature on an allotment form for a mere 30-40 percent interest.
But something about this just burns my ass. Here’s a guy who once wore the uniform of our service, who, while having a less than stellar career as a pilot, was still nominated for flag rank until enough voices were raised to eventually shoot his star down like he did the manned Air Force F-4 so many years ago.
And yet he makes a damn good living off ripping off people in uniform.
Oh, make no mistake–he serves as the good face of a company “serving the military community.” From a Stripes LTTE:
The ProPublica article referencing USA Discounters that posted to stripes.com on July 24 (“‘They’re basically ruthless’: The discount store that sues servicemembers worldwide”) and its accompanying piece, “For lenders, gaps in federal law make suing servicemembers easy,” inaccurately portray the practices and policies of our company and our dealings with military customers.
It is against the law for USA Discounters to discuss the cases of individuals who purchased items from us on credit and defaulted on their payments. Prior to publication, the company asked the reporter to obtain permission from the customers referenced to allow us to release those details — which would have told a very different story than the one reported. The reporter was unable to obtain that permission.
It is irresponsible to report on allegations of this nature, knowing that there is another side to the story and knowing that the subject of the allegations is legally barred from telling it.
USA Discounters is proud of our long and important relationship with the military community. The company has always held that the men and women who serve and sacrifice for our country should be treated with the honor and respect they deserve. And we consistently work to meet that standard.
Izzat so, Timmy? You were quoted for the story. You had an opportunity to give your side, or to explain that because of legal issues, you couldn’t comment specifically. How many of those other 230 members would you want quoted? How many of your other current and former customers would you REALLY want to give a review of your business?
Your own employees state that they are NOT to sell a product, but a credit plan. To most people, your plans suck. But you don’t exist to cater to them. Your function is, as I stated earlier, is to separate as much money from as many gullible junior servicemembers as you can with overly inflated prices on crap products with useless warranties and credit plans that would make a loanshark blush in embarrassment.
So really, Mr. Dorsey–are you providing a service, or just servicing?
