Lawsuit against Mariner Finance started by PA’s AG continues to grow with six new states

03 April 2024- Attorney General Michelle Henry announced that six new states have joined Pennsylvania in its federal lawsuit against Mariner Finance regarding widespread violations of multiple consumer protection laws that cost consumers hundreds of millions of dollars.

Illinois, Indiana, New York, North Carolina, Tennessee, and Wisconsin filed a Motion to Intervene in the lawsuit, which the court granted this week. The litigation began in 2022 when Pennsylvania, the District of Columbia, New Jersey, Oregon, Utah, and Washington filed suit in federal court.

The states filed a second amended complaint Monday.

The recent development comes several weeks after the court denied Mariner Finance’s motion to dismiss all claims, which enabled the lawsuit to proceed in one court, vastly conserving states’ resources.

“This mega lending company preyed on and deceived consumers by hiding fees and costs for products, while illegally soliciting existing borrowers who already were struggling to afford payments to take on even more debt,” Attorney General Henry said. “Pennsylvania now has eleven state partners in litigation that seeks restitution for consumers and complete makeovers of all existing loan agreements.”

Mariner Finance is owned by a Wall Street private equity fund managed by Warburg Pincus LLC, operating over 480 branches in 27 states and managing more than $2 billion in loans.

The multistate lawsuit asks the court to order:

  • Full restitution to all borrowers affected by Mariner’s unlawful practices
  • Repayment by Mariner of any unlawfully gained profits
  • Rescission or reformation of all contracts or loan agreements between Mariner and consumers affected by the company’s unlawful practices
  • Mariner to stop charging consumers for add-on products and cease other harmful practices
  • Civil penalties

The suit alleges that Mariner Finance charged consumers for hidden add-on products that consumers either didn’t know about or didn’t agree to buy. Consumers left Mariner Finance believing they had entered into an agreement to borrow and repay, over time, a certain amount of money. In reality, because of these hidden add-on products, Mariner added hundreds to thousands of dollars to the total amount a consumer owed.

In 2019 alone, Mariner charged consumers $121.7 million nationwide in premiums and fees for add-on products. Notably, these numbers do not include all of the interest Mariner earned on the add-on premiums and fees which represent additional harm to consumers.

The lawsuit also alleges that Mariner Finance engages in illegal, aggressive sales tactics to extend credit to new borrowers. Mariner’s marketing heavily features the claim that consumers can visit a Mariner Financial branch and leave with a check on the same day. Mariner mails hundreds of thousands of unsolicited “live checks” to consumers. Once consumers cash these checks, Mariner aggressively pushes them to visit a branch to refinance and take out additional debt, which typically comes with hidden add-on products, even if it’s not in the best interest of the consumer.

Pennsylvania borrowers who believe they have been deceived by Mariner’s harmful practices should file a complaint with the Bureau of Consumer Protection either online, by phone at 1-800-441-2555, or by email scams@attorneygeneral.gov