State Attorney General

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Last week, attorneys general from 13 states filed a federal lawsuit in the Southern District of New York against OneMain Financial (OneMain) and affiliated companies, alleging deceptive and unfair practices related to the sale of its loan “add-on” products.

Led by New York Attorney General Letitia James, the multistate coalition asserts that OneMain’s practices violate the federal Consumer Financial Protection Act (CFPA) and state consumer protection and banking laws. The case serves as an important reminder that while the CFPB’s enforcement activity has waned during the Trump administration, the states continue to have the ability to enforce the CFPA, and certain states are willing to try and fill the enforcement gap left by the CFPB’s retreat. 

Alleged Deceptive Loan Add-On Practices

The complaint alleges that OneMain offered these optional add-on products, such as credit insurance and membership services, and incorporated their cost into the loan principal, resulting in undisclosed interest charges for the add-ons. In some cases, the complaint alleges, OneMain added these products without borrowers’ consent, charging customers for add-ons even after they declined them.

Continue Reading State AGs Sue OneMain Financial Over Deceptive Loan Add-Ons 

New York has amended its General Business Law to move beyond a deception-based consumer protection standard and authorize enforcement against unfair and abusive practices, giving the Attorney General materially broader discretion to shape marketplace conduct. The new framework resembles federal UDAAP enforcement in that it relies less on detailed statutory rules and more on evolving enforcement judgments about what constitutes “fair” conduct.

In announcing the amendments to New York GBL § 349 contained in the Fostering Affordability and Integrity through Reasonable (FAIR) Business Practices Act, Attorney General Letitia James pointed to lending and debt collection practices, fee structures, billing mechanics that complicate understanding, contract terms viewed as exploitative, student loan servicers, car dealers, nursing homes, health insurance companies, and impacts on vulnerable or limited-English-proficient consumers. The statute also expressly recognizes potential harm to small businesses and nonprofits, extending potential exposure beyond traditional consumer relationships.

Continue Reading New York Broadens Attorney General Authority and Embraces Enforcement-Driven Regulation

Earlier this month, attorneys general from seven states launched a coordinated inquiry into the rapidly expanding “buy now, pay later” (BNPL) market. Led by Connecticut and North Carolina, and joined by California, Colorado, Illinois, Minnesota, and Wisconsin, the multistate coalition of attorneys general sent letters to six major BNPL providers, outlining concerns that the companies’ products may be violating state consumer protection laws.

Regulators Cite Risks: Repayment Challenges and Transparency Concerns

In the letters, state AGs request information on pricing and repayment structures, as well as copies of consumer contracts, user agreements, and disclosures. The inquiries focus on determining whether consumers have received what the states view as appropriate protections—specifically, whether they have encountered a lack of transparency, undisclosed fees, and risky repayment structures.

Continue Reading State AGs Increase Scrutiny of Buy Now, Pay Later Providers Amid Consumer Protection Concerns

Last week, the Federal Trade Commission (FTC) and the Nevada Attorney General’s Office jointly filed suit against a group of tax debt relief companies operating under the “American Tax Service” brand, alleging the defendants misled struggling consumers through deceptive telemarketing tactics and false claims of government affiliation.

FTC and Nevada AG Take Action Against Tax Debt Relief Companies

The case, filed in Nevada federal court, highlights the continued focus of regulators on companies that prey on consumers’ fears of tax enforcement and misuse of government imagery or language to lend artificial legitimacy to their claims. The court has already granted the FTC’s request for a temporary restraining order and asset freeze, halting the defendants’ operations while the case proceeds. The case is the only one filed by the FTC since the government shutdown, and the FTC has sought to stay most litigation it had already commenced.

Continue Reading FTC and Nevada AG Crack Down on Deceptive Tax Debt Relief Scams Mimicking the IRS

Join us as we spotlight select chapters of Venable’s popular Advertising Law Tool Kit, which helps marketing teams navigate their organization’s legal risk. Click here to download the entire Tool Kit.

The Federal Trade Commission, state attorneys general, and class action plaintiffs continue to scrutinize negative option and continuity offers, including automatic renewals, free-to-pay conversions, and continuity programs.

The FTC’s updated Negative Option Rule mandates clear disclosures, unambiguous affirmative consent, and simple cancellation mechanisms. Marketers must disclose material terms such as price, frequency, and cancellation details prominently and understandably, including on mobile devices. Consumers should give informed consent and receive post-transaction confirmations and renewal reminders. Companies must honor cancellation and refund policies and address complaints effectively.

Continue Reading Negative Option and Continuity Marketing

Join us as we spotlight select chapters of Venable’s popular Advertising Law Tool Kit, which helps marketing teams navigate their organization’s legal risk. Click here to download the entire Tool Kit, and tune in to the Ad Law Tool Kit Show podcast, to hear an author of this chapter dive deeper into state AG inquiries in this week’s episode.

State attorneys general (AGs) are the chief legal officers of their states or territories and can bring actions to protect the “public interest” in almost any area of law. They represent the state government and the general public and have broad jurisdiction over everything from public corruption to consumer protection.

Continue Reading State Attorney General Inquiries: An Excerpt from the Advertising Law Tool Kit

Episode 11 of the Ad Law Tool Kit Show, “State Attorney General Investigations,” is now available. Listen here, or search for it in your favorite podcast player.

State attorneys general (AGs) are the chief legal officers of their states, and their areas of concern are vast. Aggressive enforcement against telemarking, debt relief, privacy violations, and charity fraud can generate goodwill with an AG’s state residents. Compliance with laws, prompt complaint resolution, and proactive engagement with AGs are crucial.

In this episode, I talk to former Venable partner Alex Megaris about how businesses facing AG inquiries should retain documents, negotiate confidentiality agreements, and focus efforts on smaller AG committees in multi-state actions to manage these probes effectively.

Continue Reading Listen to Episode 11 of Venable’s Ad Law Tool Kit Show – “State Attorney General Investigations”

This week, a New York district court, in FTC v. Quincy Bioscience Holding Co., granted an individual defendant’s partial motion for summary judgment, dismissing claims brought by the New York Attorney General (NYAG) for lack of personal jurisdiction over him. The dismissal shows a procedural challenge to the FTC’s effort to piggyback on the remedial authority of state AGs to backfill the hole in its remedial powers after the Supreme Court’s decision in AMG Capital Management v. FTC.

A quick refresher: In 2017, the FTC and the NYAG filed a complaint against several defendant companies and two individuals in their capacity as officers of those companies for failing to have proper substantiation to claim that a cognitive supplement improved memory. The FTC relied on Section 13(b) of the FTC Act to seek permanent injunctive relief and equitable monetary relief. On the other hand, the NYAG relied on certain state consumer protection statutes relating to repeated fraudulent or illegal conduct, deceptive business practices, or false advertising. These New York statutes allow for appropriate equitable relief that may include, among other things, restitution and disgorgement of ill-gotten monies. We have previously blogged on this case here and here. After AMG, the relief sought by the NYAG became significantly more important.

Continue Reading District Court to New York Attorney General: “No Personal Jurisdiction Piggybacking”

Last week, New York Attorney General Letitia James announced that online travel agency Fareportal Inc., which operates several travel-related websites and mobile platforms, including CheapOair.com and OneTravel.com, will pay $2.6 million to New York for misleading consumers with deceptive marketing tactics.

“Consumers wanted to land affordable tickets through Fareportal’s platforms, but were met with lies instead,” James said in a statement. “Fareportal used deeply deceptive tactics to trick millions of consumers into booking airline tickets and hotel rooms.”

The investigation into Fareportal revealed that, since at least 2017, the company created false urgency around the availability of airline tickets and hotel rooms to pressure consumers into making purchases on its platforms. The AG challenged these marketing tactics as “dark patterns,” referring to alleged misleading design features and methods used to manipulate consumers into buying goods and services. As we have covered previously, alleged “dark patterns” have become a priority in rulemaking and enforcement.Continue Reading New York Attorney General Secures $2.6 Million from Fareportal for Deceptive Marketing Tactics

State attorneys general nationwide have continued to be aggressive consumer protection law enforcers. In the wake of April’s unanimous Supreme Court decision curtailing the Federal Trade Commission’s (FTC) ability to recoup equitable monetary relief from businesses accused of fraudulent or deceptive practices, state-level enforcement activity and state-federal coordination are expected to increase. In fact, just days after our recent webinar a coalition of state AGs wrote to Congress supporting legislation that would restore the FTC’s authority, while noting that “the states’ own enforcement efforts are fortified through collaboration with the FTC.” In that webinar, Venable partners Eric Berman, of our Advertising and Marketing Group, and Erik Jones, of our eCommerce, Privacy, and Cybersecurity Group, addressed state AG enforcement trends and strategies for responding to a state AG investigation.

Q: How do state AGs become aware of the issues or complaints that might drive an investigation?

A: Consumer complaints drive regulatory investigations, and state AGs may become aware of these complaints in a variety of ways. Consumers can file complaints directly with a state AG office, either online, via telephone hotline, or via “snail mail.” State AG staff may access the FTC’s Consumer Sentinel, a consumer complaint database that is free and available to any federal, state, or local law enforcement agency. State AG lawyers and non-lawyer investigators scour the Better Business Bureau (BBB) websites and so-called “gripe” sites, and may pose as consumers themselves to “secret shop” a targeted business. Finally, state AGs might become aware of your marketing practices through disgruntled former employees (or board members), competitor complaints, national and local media coverage, or referrals from other law enforcers.Continue Reading You Asked, We Answered – State AGs and Consumer Protection: An Update and Outlook