Oklahoma Attorney General Gentner Drummond and a bipartisan coalition of 12 other state attorneys general have filed a lawsuit against OneMain Financial, Inc., alleging the company used deceptive lending practices that cost consumers hundreds of millions of dollars in hidden fees and interest.
The lawsuit alleges the installment lender marketed loans with “clear, upfront terms” while quietly adding insurance policies and other products that significantly increased the total cost for borrowers.
Drummond said the practices misled consumers and violated expectations of transparency.
Oklahoma Attorney General Gentner Drummond
There are 19 OneMain Financial branches operating in Oklahoma.
According to the Oklahoma Attorney General’s Office, the lawsuit claims OneMain Financial engaged in a “bait-and-switch” scheme that included:
- Failing to advertise that add-on products would be sold alongside loans
- Misrepresenting or hiding add-on products from borrowers
- Charging some consumers for products they declined
- Pressuring employees to include add-ons in loans
- Rushing customers through the loan closing process without adequate time to review documents
- Controlling computer screens during signings, limiting borrower access to terms
- Burying add-on details within lengthy, complex contracts
- Finalizing loans on smartphones, where text may be difficult to read
- Encouraging refinancing while adding new products and concealing key terms
The lawsuit also alleges that OneMain’s internal policies appear to prohibit such practices but its actual operations differ significantly.
Drummond and the coalition are seeking:
- Restitution for consumers charged for add-on products
- Financial penalties for alleged violations of state laws
- Disgorgement of unlawful profits
- A court order to stop the alleged practices
The lawsuit also requests that the company:
- Remove negative credit information tied to the add-on products
- Drop any legal actions against customers related to those products
Joining Oklahoma in the lawsuit are attorneys general from: Colorado, Maryland, Nevada, New Hampshire, New Jersey, New York, North Dakota, Pennsylvania, South Dakota, Virginia, Washington, Wisconsin
You can read the full lawsuit here.