Attorney General Letitia James has delivered an early holiday gift to nearly a thousand New Yorkers caught in predatory debt schemes. As reported by the Office of the Attorney General (OAG), a $2.4 million debt relief and reform agreement has been reached with Monterey Finance, qualifying as a substantial win for consumer protection.
The OAG investigation unveiled Monterey's deceptive practices, which included the selling of leasing agreements masked as regular consumer finance deals. Special attention is drawn to their partnership with businesses in collecting contracts that falsely promised "financing" opportunities at point of sale. According to the Office of the Attorney General's findings, these leases came with excessive fees and obscured terms that left consumers paying for more than just the items' sticker prices. In some instances, the final costs soared over 200 percent above those initial price tags.
These misleading agreements led people to believe they were purchasing items like pets or wedding dresses outright, whereas, in truth, they were merely leasing them with the ownership only transferring after a final fee was paid. The New York Attorney General's Office notes that such practices exploited consumers' financial needs for Monterey's profit, charging illegal fees and duping them to enrich their revenues.
One particular case highlighted by the OAG involved a consumer who signed what they thought was a finance deal to buy a $2,000 puppy, only to end up paying a staggering $3,592.95 after all fees and monthly payments were tallied. Monterey's 'legal department' threats to consumers behind on their payments, for items as personal as family pets, exacerbated the distress for many of these individuals.
Under the terms of the settlement with the OAG, Monterey Finance is to pay $175,000 in penalties, discontinue collection on any debt from leases, and cancel all existing leases in New York. This action erases approximately $2.4 million in consumer debt. Moreover, Monterey is required to request consumer reporting agencies to remove any negative credit scoring that stemmed from these leases.
Attorney General James, who has a track record of targeting predatory lenders, reaffirmed her commitment to holding such entities accountable. "Monterey preyed on consumers who needed financial assistance by charging illegal fees and deceiving them to make a profit," she stated, as per the Attorney General's Office. Building on previous cases against various lenders, this settlement further cements James' role as a stalwart defender of consumer rights.
The case was spearheaded by Assistant Attorney General Julia K. Toce and Assistant Attorney General in Charge Deanna R. Nelson, with the investigation led by Supervising Investigator Chad Shelmidine. Collectively, their efforts signal a continuing crackdown on illicit financial practices within the state of New York.
