NEW YORK, March 16 (Reuters) – A bipartisan group of 13 U.S. state attorneys general sued OneMain on Monday, accusing the subprime lender of charging cash-strapped borrowers hundreds or thousands of dollars for “add-on” products they did not request and do not need, saddling them with hundreds of millions of dollars in extra costs.
Shares of OneMain fell more than 9% in afternoon trading after the lawsuit was filed.
In a complaint filed in Manhattan federal court, attorneys general led by New York’s Letitia James and Pennsylvania’s David Sunday said OneMain rewards loan closers, branch managers and district managers with commissions and gift cards for selling “extremely expensive” credit insurance, term life insurance, and lifestyle- and health-related membership plans that have little value…