Last month, the Washington State Attorney General sued Rent-a-Center, a leading rent own store operator, accusing the company of a slew of illegal, anti-consumer practices.
The most puzzling part of the story, for me at least, was the fact that former Los Angeles Lakers star Magic Johnson is working for the company as a spokesman, and is featured prominently in the company's televised ad campaigns.
Consumer advocate Edmund Mierzwinski, Consumer Program Director for U.S. PIRG, told me what he thought of Johnson's endorsement of the company in a phone interview: "There's a lot of people that I'm unhappy with what they do to make money, and Magic Johnson is one of them. There is nothing good about rent to own and promoting rent to own is promoting a predatory product and people will never get ahead with it. Rent to own promises the dream of ownership and then takes it back with a 100-week contract. It's very difficult to meet the terms of the contract and when you don't meet the terms, they may come and violate the debt collection laws. I thought Magic Johnson made enough money playing for the Lakers. He's got to be able to find better endorsement deals than this."
And this isn't the first controversial business practice Johnson has lent his name and credibility to. He's also served as a pitchman for Jackson Hewitt's tax refund anticipation loans -- loans that carry an annualized interest rates of upwards of 100% in some cases.
Mierzwinski added that Rent-A-Center and the predatory lending industry have a well-documented history of targeting low-income minority communities with their "services" -- it's probably that desire to target those communities that has led them to seek out someone with the stature of Magic Johnson as a spokesperson.
And it's shameful that Johnson has allowed his integrity to be sold to groups that seek to exploit the communities he is such an icon in.
We contacted Rent-A-Center for a response, but hadn't received one. We'll update if we hear back.
Why is Magic Johnson shilling for Rent-a-Center?