AGs: Md. Lender piles up insurance plans for borrowers – WTOP News

The lawsuit – filed by the attorney general of the District of Columbia, New Jersey, Oregon, Pennsylvania, Utah and Washington – alleges that Mariner Finance forced dealers to “add” additional insurance to customers who wanted their loans and more.

PHILADELPHIA (AP) – A Maryland-based lender defrauded his mortgage customers by selling them insurance policies they never asked for or knew about, the state’s attorney general said in a lawsuit filed Tuesday in federal court in PHILADELPHIA (AP) Pennsylvania.

The lawsuit – filed by the attorney general of the District of Columbia, New Jersey, Oregon, Pennsylvania, Utah and Washington – alleges that Mariner Finance forced dealers to “add” additional insurance to customers who wanted their loans and more.

“Mariner presents itself as a local lender that operates in small local branches that are closely related to its location. In reality, Mariner uses an aggressive, cost-effective marketing strategy, driven by a profitable strategy that works. according to Glengarry Glen Ross’ famous slogan: Always Close,” the nearly 100-page lawsuit.

The lawsuit seeks consumer refunds as well as civil penalties and disgorgement, among other consequences.

Mariner denied the story in a statement from founder and CEO Josh Johnson, who said the company cooperated with the investigation and provided information, documents and evidence “that clearly demonstrate the legitimacy of its products and the important services it provides to consumers.”

“Mariner Finance has consistently disputed the claims that the multinational conglomerate has made and will continue to defend itself as an important lender to those who may have access to alternative sources of credit,” Johnson said.

The suit provides an overview of internal sales strategies and motivational messages from managers urging employees to sell various types of insurance, including casualty and liability insurance. It’s not something most consumers would expect, according to the suit, since Mariner bills itself as a lender, not an insurance company.

Mariner operates 480 branches in 27 states and manages $2 billion in loans.

In 2019, Mariner sold about $122 million in salaries and fees for so-called extras, not including interest, according to the suit.

The average loan size was $3,650, and about 28%, the suit said. Insurance surcharge calculated at $360 per loan, excluding interest.

“Since the fees and charges are covered by cash, these additions add approximately $180 in interest to the loan, for an additional purchase price of approximately $540,” the lawsuit said.

The lawsuit added that 80% of consumers, by 2020, were charged for additional insurance.

Most of the consumers interviewed by the authorities as part of the proceedings said they did not know that the extras were optional, that they cost more or that they had extras.

These loans, in most cases, were for consumers with financial problems who had financial needs, according to Cari Fais, who heads the New Jersey Division of Consumer Affairs.

“Mariner’s practice of attaching expensive extensions to the loans of unsuspecting consumers undoubtedly placed many families already in debt in dire straits,” Fais said in a statement.

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