Suit targets insurer over car club fees

Posted 7:24AM on Wednesday 10th July 2002 ( 22 years ago )

ATLANTA - Ten elderly or disabled Fulton County residents have filed suit against a loan company they claim packaged small loans with numerous extras that drove up the cost of the loans. The lawsuit filed Tuesday in Fulton County Superior Court said Stewart Finance Co. took loan payments out of their small Social Security checks each month for ``car club'' memberships and other ``worthless insurance products from which the defendants derive rich commissions and undisclosed kickbacks.'' The plaintiffs include people who don't own cars but had car club membershps tacked onto the loan payments. One of them, Kellysteen Ruffin, borrowed $178 and found herself owing $500 in principal alone because of a car club membership she didn't know she had signed up for, according to the suit. It said other debtors were charged for disability insurance on the loan, even though they were already on disability. John Ben Stewart, owner of Stewart Finance Co., did not return calls from The Atlanta Journal-Constitution seeking comment Tuesday. His attorney, Roy Manoll, also would not comment, saying he had not yet seen the lawsuit. Plaintiffs Elsie Williams, 68, and Arthur Favors, 65, have roadside emergency insurance that was added to loan payments being taken from their Social Security checks monthly. In exchange for cash, both agreed to have their checks deposited in a Stewart-controlled bank account and to take what was left after Stewart's fees were paid. They turned to Stewart repeatedly, in part to cover the cost of their inflated loan payments, the newspaper said. A $98 loan cost Favors $210, he said. Williams' $200 loan ended up costing her $360. Both said they signed papers accepting the extra charges, but didn't know what they were agreeing to at the time. Williams has cataracts and cannot read small print. Favors never learned to read.

http://accesswdun.com/article/2002/7/192645