Associates First Financial
Predatory Lending Lawsuit
Summary of the Case
On July 3, 2001, Lieff Cabraser filed a class action lawsuit on behalf of California customers of Associates First Financial, also referred to as the The Associates, and several related companies (collectively identified here as "Associates First") in California state court. Associates First was one of the nation's largest "subprime" lenders. The class action suit alleges that The Associates packed mortgage loans with unwanted and unnecessary insurance products and engaged in improper loan refinancing practices.
Plaintiffs and Defendants entered into a Stipulation of Settlement dated September 17, 2002 of the class action lawsuit. Two days later, on September 19, 2002, the Federal Trade Commission (FTC) announced a settlement with Citigroup Inc., which acquired Associates First in 2000, to resolve charges Associates First engaged in systematic and widespread deceptive and abusive lending practices. If approved, the FTC and and California class action settlements together will provide $240 million in redress to consumers throughout the United States. To read more about the FTC settlement, click here.
On November 13, 2002, California Superior Court Judge Richard A. Kramer granted preliminary approval to the class action settlement. To read a copy of the settlement notice (in Adobe Acrobat format), click here. To read the settlement agreement, click on the following links: pages 1-15; pages 16-30.
On February 27, 2003, the Court conducted its hearing on whether to grant the settlement final approval. Judge Kramer found that the $240 million settlement is fair, reasonable, and adequate, and meets all requirements for final approval. However, the Court continued the hearing to April 23, 2003 to review class counsel's request for attorneys' fees and costs, and to resolve other issues regarding class members who requested to be excluded from the settlement. The Court did not enter a final approval order on February 27, 2003.
On April 23, 2003, the Court granted final approval to the settlement. The $240 million provided to the class is separate and apart from any compensation to class counsel for the attorneys' fees and costs incurred in prosecuting the case.
Associates First Claims
If you wish to pursue a claim on your own, you may contact the Claims Administrator at 1-800-395-0451.
Additional Resources
The
Federal Trade Commission (FTC) website also
provides helpful information to consumers regarding their rights under various
consumer laws and also issues "alerts" about unfair practices
of which consumers should be aware. The mandate of the FTC's Bureau of
Consumer Protection is to protect consumers against unfair, deceptive, or fraudulent
practices. The Bureau enforces a variety of consumer protection laws enacted
by Congress, as well as trade regulation rules issued by the Commission.
Click
on the links below for information on the following topics from the FTC:
The
FTC also has a page at its website which allows you to file a Complaint
against a particular company. You can find the Complaint form here.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP is a fifty-plus attorney law firm that has represented plaintiffs nationwide since 1972. We have offices in San Francisco, New York and Nashville. We represent plaintiffs in class and group actions and in individual lawsuits in cases involving substantial losses. For the last six years, the National Law Journal has selected Lieff Cabraser as one of the top plaintiffs' law firms in the nation.
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