Monterey Finance Fleeces NYers: $2.4M Settlement

NEW YORK – Monterey Finance is shelling out $2.4 million and facing $175,000 in penalties after a scathing investigation by New York Attorney General Letitia James exposed a scheme to swindle vulnerable New Yorkers. The company masked predatory lease agreements as standard financing, leaving consumers saddled with exorbitant fees and, in some truly gut-wrenching cases, pressured to abandon their pets when they couldn’t keep up with payments.

The Office of the Attorney General (OAG) found that until 2017, Monterey partnered with businesses to offer what appeared to be financing at the point of sale. But these weren’t loans. They were leases, deliberately disguised to hide crippling fees tacked onto monthly payments—fees that routinely ballooned the final cost by over 200 percent of the original sticker price. Consumers thought they were buying, not renting-to-own, and were shocked to learn they wouldn’t actually own the goods until a final, hefty fee was paid.

The deception went beyond just hidden costs. Monterey preyed on desperation. The OAG investigation revealed the company not only charged illegal “pay-to-pay” fees to those already struggling, but actively threatened repossession – even for items with no resale value. Most disturbingly, consumers who fell behind on payments for items like family pets were advised to surrender those animals to shelters when they couldn’t meet their monthly obligations. Imagine believing you owned a beloved companion, only to be told you’re leasing it, and then urged to give it away because you can’t afford the lease.

The numbers paint a bleak picture. One victim, who signed an agreement for a $2,000 puppy, ended up paying a staggering $3,592.95 after all the fees and payments were tallied. The OAG also found that Monterey illegally serviced leases for items like car repairs – services that can’t be returned and have zero residual value – further violating New York law. Unlike legitimate lease-to-own agreements, Monterey didn’t allow customers to return the goods they were supposedly leasing.

Under the settlement with the OAG, Monterey must cancel all outstanding leases in New York, cease all debt collection efforts on those leases, and pay the $175,000 penalty. The $2.4 million in debt relief will be distributed to approximately 835 New York consumers. “Monterey preyed on consumers who needed financial assistance by charging illegal fees and deceiving them to make a profit,” said Attorney General James. “These misleading tactics cost New Yorkers millions of dollars.”

This case serves as a stark reminder that predatory lenders will exploit any loophole to line their pockets. Attorney General James has sent a clear message: deceptive practices won’t be tolerated, and those who prey on vulnerable New Yorkers will be held accountable. This isn’t just about money; it’s about the emotional toll these scams take on families and individuals already struggling to make ends meet.