1 hour ago
Nation
Mar 16, 2026 4:48 PM EDT
NEW YORK (AP) — A bipartisan group of 13 attorneys general filed a lawsuit against OneMain Financial on Monday, accusing the company of adding unwanted products and hidden fees to its loans, which increased costs for borrowers.
The lawsuit, filed in New York, alleges that OneMain employees steered borrowers into purchasing credit insurance and other loan-related products by making deceptive claims about whether these products were mandatory and how they could be canceled. The attorneys general say this conduct affected tens of thousands of borrowers and violated state consumer protection laws.
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The products include credit insurance, which promises to pay the loan if a consumer dies or becomes unemployed, as well as home and auto membership services similar to AAA. These companies are owned by OneMain through a related entity.
These add-ons increase the overall cost of the loan. The lawsuit also alleges that OneMain failed to verify whether consumers already had home or auto membership services like AAA.
"OneMain targets people who are already struggling financially, saddling them with hidden fees and misleading loans to trap them in even more debt," said New York State Attorney General Letitia James in a statement.
OneMain stated that the practices cited in the lawsuit were previously reviewed by the Consumer Financial Protection Bureau (CFPB) in 2023. As part of that settlement, OneMain agreed to repay $10 million to consumers and pay $10 million in fines and penalties for allegedly selling add-on products.
"The states' allegations are simply untrue — their case is wrong on the facts and wrong on the law and attempts to re-litigate issues that were already reviewed by the Consumer Financial Protection Bureau and fully resolved. We will litigate this case vigorously and look forward to proving the truth in court," OneMain said.
Based in Evansville, Indiana, OneMain is one of the largest non-bank installment lenders in the U.S. It primarily serves customers with subprime credit scores, many of whom are already facing financial difficulties.
Besides New York, the attorneys general joining the lawsuit represent the states of Colorado, Nevada, Maryland, North Dakota, Oklahoma, Washington, Wisconsin, New Jersey, South Dakota, and New Hampshire, as well as the Commonwealths of Virginia and Pennsylvania.
Left: In this photo illustration, the OneMain Financial logo is displayed on a smartphone screen. Photo by Thomas Fuller / SOPA Images via Reuters Connect
