In recent months, the Consumer Financial Protection Bureau has quietly withdrawn two related enforcement actions pending in federal court. [1] Together, these now-dismissed cases sought to curb a rising, inventive, and controversial financial product: the virtual rent-to-own agreement .

A virtual rent-to-own agreement, or “VirTO,” is a type of sales contract, through which a financial technology company can rent high-cost goods to consumers as an alternative to traditional financing. Critics claim that these agreements represent a predatory form of regulatory arbitrage, allowing businesses to evade consumer protection laws and charge the equivalent of illegally high interest rates. [2] Proponents, in contrast, tout the flexibility of these agreements and their ability to offer a f

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