If you feel all warm and fuzzy when you see Tom Selleck promising that AAG reverse mortgage company is not going to rip-off seniors, you just might want to read what a federal agency Friday said about the firm.
The Consumer Financial Protection Bureau accused AAG of deceptive advertising intended to mislead seniors and agreed to settle the suit for $1.1 million.
“American Advisors Group violated consumers’ trust by advertising reverse mortgages with inflated and deceptive home-value estimates,” said Acting CFPB Director David Uejio.
“The CFPB will act decisively when we uncover consumer harm or practices that seek to take advantage of vulnerable populations.”
The CFPB said AAG:
“Deceptively inflated home values: In marketing their reverse-mortgage products, AAG provided consumers with inflated estimates of home values to entice them to enter into negotiations to open a reverse mortgage.
AAG’s actions were deceptive because they would lead a reasonable consumer to believe that the consumer could reap more proceeds from the reverse mortgage than were actually available.
Made deceptive representations about the accuracy of home estimates: AAG’s marketing materials to consumers stated that it “makes every attempt to ensure the home value information provided is reliable.”
In fact, AAG made no real attempt to do this. AAG’s misrepresentations induced consumers to rely on AAG’s inflated estimates and to enter into negotiations with the company.
Violated 2016 administrative consent order: In December 2016, the CFPB filed an administrative consent order against AAG for a variety of deceptive statements made in marketing materials that violated the CFPA.
The order prohibited AAG from violating the CFPA for five years, or until December 2021. The deceptive acts and practices committed by AAG as described in this complaint violate the 2016 consent order.”
Last year , AAG paid $3.5 million to settle a class action lawsuit for harassing consumers with prerecorded telemarketing calls.
