State AGs Sue OneMain Financial For Misleading Consumers On Auto Insurance

State AGs from 13 states have filed a multistate lawsuit against OneMain Financial alleging that it “packed” personal loans with junk-fee add‑ons, including home and auto membership products similar to auto club/roadside assistance, through misleading and high‑pressure tactics that often left borrowers believing these products were required.

Who sued and where

• A bipartisan coalition of 13 attorneys general filed suit in federal court, led by New York and including other states such as New Jersey and New Hampshire.

• The complaint was filed in the Southern District of New York on March 16, 2026.​

Core allegations about “auto” products

• OneMain allegedly loaded loans with optional add‑on products, including credit insurance and membership services that bundle home and auto benefits comparable to AAA‑style roadside assistance and related services.

• AGs claim staff steered borrowers into these add‑ons using misleading statements about whether they were required to get the loan, and failed to confirm if consumers already had similar home/auto memberships (for example through AAA) before selling them duplicative coverage.

• The complaint describes add‑ons being “pre‑packed” into loan paperwork, rushed signings, and “forced” or “secretly packed” products that could add hundreds of dollars per borrower, with some estimates around an average of roughly $800 in junk fees per loan.

Legal theories and relation to CFPB order

• The states allege violations of their UDAP statutes (unfair, deceptive, or abusive acts and practices), including deceptive misrepresentations about add‑ons being required, unfair loan‑packing, and abusive interference with consumers’ understanding that these products were optional.

• The complaint explicitly builds on the CFPB’s 2023 consent order, which found OneMain deceptively upsold add‑ons such as roadside assistance, identity theft protection, credit life and disability insurance, and then failed to provide a true “full refund” by keeping about $10 million in interest tied to canceled add‑ons; OneMain paid $10 million in redress and $10 million in penalties in that action.

Relief sought and potential exposure

• The AGs seek restitution for affected borrowers, civil penalties, disgorgement of the alleged junk‑fee revenues, and injunctive relief to permanently bar OneMain from packing loans with undisclosed or deceptively marketed add‑on products.

• Public summaries from AGs describe “hundreds of millions” in junk‑fee revenue at issue, implying substantial potential restitution and penalties layered on top of the prior CFPB $20 million order.