A proposed class action alleges that Bankers Healthcare Group (“BHG”) and part-owner Pinnacle Bank (“PB”) have issued to consumers expensive loans fraudulently disguised as business loans to hide their “predatory” lending practices in violation of federal and state consumer-lending statutes. The lawsuit looks to represent anyone who signed or co-signed a financial loan from BHG or PB in an amount of $20,000 or more, under a promissory note identifying the “debtor” as a “sole proprietor” or as a natural person doing business as (d/b/a) himself or herself.
BHG is alleged in the lawsuit to:
- Run afoul of numerous consumer protection laws, including the federal Truth in Lending Act, by conspiring to mislead tens of thousands of middle-income individuals to take out large, high-cost financial loans.
- Disguise loans as “commercial loans” despite being aware that the borrowers are full-time, W-2 employees with no intention of starting their own businesses as “sole proprietors” and who, instead, took out the loans for personal or household purposes.
- Impose excessive origination fees and interest rates without providing certain disclosures required by law, and penalize or outright prohibit consumer prepayments in order to maximize interest accrual.
- Charge interest on undisbursed funds and secure their loans with all of a borrower’s property as collateral, without providing the requisite disclosures and consumer protections for such an agreement.
- Insert false “commercial” and “sole proprietor” language into their loan documents sent to consumers, to fraudulently disguise “consumer credit” transactions as “commercial” credit transactions.
- Disguise their consumer lending as “commercial” lending in order to evade federal and state regulatory scrutiny, and to increase their own profits at the expense of unsuspecting consumers.
- Start the solicitation process by offering fast funding in large amounts from either BHG or PB.
- Mislead consumers to believe that the loans will not require collateral or affect a borrower’s credit score.
- Avoid consumer credit reporting only by fraudulently drafting and reporting their loans as business loans, to businesses that they know are non-existent.
- Have its sales people usually fill out most or all of the loan application for the borrower and “routinely persuade” them to click through the online paperwork—which relies heavily on “legalese”—while the salesperson remains on the phone with the consumer.
- Even where consumers voice questions or concerns about certain terms in the companies’ loan documents, BHG personnel are trained to orally explain away predatory terms as innocuous, earning the consumer’s trust with their interpersonal charisma and apparent professional knowledge. As a result, borrowers remain in the dark about the lenders’ “expensive and punitive” financial terms “until well after a transaction is executed.”
One Texas plaintiff claims that:
- When he spoke to a BHG salesperson on the phone and was informed that he qualified for a large cash loan, he was allegedly sent pre-filled paperwork to sign electronically.
- The promissory note included in the documents sent to him allegedly identified PB as the creditor and listed him as a consultant, despite the fact that he had never worked as one.
- The promissory note allegedly stated that it was “FOR COMMERCIAL PURPOSES,” even though he allegedly had informed the BHG salesperson that he intended to use the loan to help pay off credit card debt.
- The pre-filled, “COMMERCIAL” and “Consultant” language in BHG and PB’s loan documents was allegedly verifiably false, and they knew this when they sent their pre-filled loan documents to him, yet he relied upon BHG’s inducements to quickly and electronically sign the PB loan documents.
- The loan documents allegedly imposed “crippling credit terms” on him.BHG deducted more than $6,500 in origination fees from the principal amount of $84,512.80 and charged an annual percentage rate of roughly 18 percent, all without disclosing these terms to the consumer, as required by law.
- The documents unlawfully allegedly barred borrower prepayments for a certain period and stipulated that the loan was secured by all of the plaintiff’s property, including his home.
If you have received a collection notice or are being sued for a loan from Bankers Healthcare Group or BHG Financial group, LLC(LINK Bankers Healthcare Group Lawsuits – Experienced Buffalo Lawyers (wny-lawyers.com), call or text our Syracuse, NY law office (LINK Law Firm Syracuse, NY – Experienced Buffalo Lawyers (wny-lawyers.com) at 315.864.5715 or use our contact form for a confidential consultation today.
If you have received a collection notice or are being sued for a loan from Bankers Healthcare Group or BHG Financial group, LLC, call or text our Syracuse, NY law office at 315.864.5715 or use our contact form for a confidential consultation today.