Furniture startup Fernish has settled with California regulators who said that Fernish overcharged customers late fees and didn't provide rent-to-own disclosures required by law. It's the first action against a rent-to-own company taken by California regulators under the California Consumer Financial Protection Law (CCFPL), which was established in 2020.
The Los Angeles company, which is backed by investors including Khosla Ventures, agreed to refund at least 387 customers for overcharges and "desist" from violating the CCFPL.
"Our team here at Fernish is happy to have gone through the compliance process and to be working closely with the California Department of Financial Protection and Innovation," Fernish CEO Michael Barlow said in a statement. "We will continue to operate our business in as consumer-friendly of a way as possible, similar to how we always have."
Fernish, which has raised $42 million according to Pitchbook, offers rent-to-own, subscription and traditional purchase of furniture. The company didn't disclose information about the maximum price it would charge consumers as required by law, according to the California Department of Financial Protection and Innovation.