OKLAHOMA CITY — Oklahoma Attorney General Gentner Drummond, alongside 12 other state attorneys general, has filed a lawsuit against OneMain Financial, Inc. and its related entities, alleging that the company has been charging consumers hidden fees and interest through deceptive practices tied to high-cost installment loans.
Allegations Against OneMain Financial
Drummond’s office claims that OneMain Financial, which operates 19 branches in Oklahoma, advertises loans with “clear, upfront terms” but hides insurance policies and other add-on products that inflate the cost of the loans. The lawsuit asserts that these additional costs are applied under rushed conditions, sometimes involving misrepresentation or charging consumers who reject the add-ons.
Attorney General Drummond emphasized the need for honesty and transparency in lending practices, stating, “Oklahomans deserve honesty and transparency when they walk into a lender’s office. Lenders should not be hiding costly products in the fine print or rushing borrowers through contracts.”
Key Allegations Against OneMain Financial
The lawsuit outlines several allegations about OneMain’s business practices, including:
- Add-on products not disclosed: OneMain does not advertise the sale of additional products, leading consumers to be unaware of their inclusion in loan agreements.
- Internal policies vs. actual practices: Although OneMain has policies preventing unlawful add-on packing, the actual process differs significantly, with employees pressuring customers to accept these add-ons.
- Rushed loan process: OneMain is accused of rushing consumers through the loan signing process, with employees controlling the computer screen during the signing, limiting the consumer’s ability to review the loan documents properly.
- Hidden fine print: The company is said to bury crucial information about add-on products in a lengthy legal document, often too long for consumers to properly review before signing.
- Small print on smartphones: When loans are closed on smartphones, the print is reportedly too small to read, further concealing important information.
- Misleading loan refinancing: OneMain allegedly encourages refinancing by adding hidden products and concealing key terms, harming customers’ financial well-being.
Seeking Remedies and Penalties
Drummond, along with the coalition of states, is seeking the following actions:
- Restitution for consumers unlawfully charged for add-on products
- Penalties for violations of state laws
- Release of unlawful profits gained by OneMain
- A court order to prevent OneMain from continuing its illegal practices
- Removal of negative credit report information related to these loans
- Withdrawal of any legal actions taken against consumers regarding the add-on products
OneMain Financial’s Response
An official with OneMain Financial has denied the allegations, calling them “untrue”. The company’s statement asserts that the case is an attempt to relitigate issues that were previously addressed by the Consumer Financial Protection Bureau (CFPB). OneMain insists it operates honestly and transparently and complies fully with all laws and regulations. The company plans to vigorously litigate the case and expects to prove the truth in court.
States Involved in the Lawsuit
The states joining Oklahoma in the lawsuit include:
- Colorado
- Maryland
- Nevada
- New Hampshire
- New Jersey
- New York
- North Dakota
- Pennsylvania
- South Dakota
- Virginia
- Washington
- Wisconsin
How to File a Complaint
If you believe you have been a victim of OneMain Financial’s business practices, the Oklahoma Attorney General’s Consumer Protection Unit encourages you to file a complaint. Contact them at 1-833-681-1895 for assistance.
Summary of Allegations and Remedies:
IssueDetails
Hidden Add-on ProductsLoans include undisclosed insurance and other fees…