NEW YORK (AP) — A bipartisan group of 13 attorneys general sued the financial company OneMain Financial on Monday, alleging the company placed unwanted additional products and other hidden costs on its loans that led to higher costs for its borrowers.
The lawsuit, filed in New York on Monday, says OneMain employees steered borrowers into purchasing credit insurance and other loan-related products while making deceptive claims about whether the products were required and how they could be canceled. The attorneys general say the conduct affected tens of thousands of borrowers and violated state consumer protection laws.
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The products include credit insurance, which claims to pay the loan if a consumer dies or becomes unemployed, as well as products like home and auto memberships that are similar to AAA. These companies are, in turn, owned by OneMain through a related company.
These products increase the cost of the loan. The lawsuit alleges that OneMain does not check whether the consumer may already have a home or auto membership service through AAA as well.
OneMain Financial sued by 13 attorneys general over hidden loan add-ons
