Bankers Healthcare Group (BHG), now operating as BHG Financial LLC, is under legal scrutiny for allegedly engaging in deceptive lending practices. Founded in 2001, BHG initially provided loans to medical professionals but has since expanded its services to other licensed professionals across the United States .
Allegations of Misrepresented Loans
A notable lawsuit filed on January 17, 2025, by Kristen Cairo, a radiology technician from Illinois, accuses BHG of issuing high-interest loans under false pretenses. Cairo alleges that BHG misrepresented a personal loan as a business loan, labeling her as a “sole proprietor” despite her clear communication that she was not engaged in any business activities. This classification purportedly allowed BHG to circumvent Illinois’ consumer protection laws, resulting in an annual percentage rate of approximately 26.9%, significantly exceeding the state’s legal limit of 9% for unlicensed lenders .
Cairo’s lawsuit claims violations of the Illinois Interest Act, Consumer Installment Loan Act (CILA), and Consumer Fraud Act. She seeks statutory damages, nullification of her loan under CILA, and compensatory and punitive damages for the alleged deceptive practices.
Class Action Lawsuit and Broader Implications
In addition to individual lawsuits, BHG faces a proposed class action alleging that the company, along with part-owner Pinnacle Bank, issued expensive loans fraudulently disguised as business loans to hide their “predatory” lending practices. The lawsuit aims to represent individuals who signed or co-signed financial loans from BHG or Pinnacle Bank in amounts of $20,000 or more, under promissory notes identifying the “debtor” as a “sole proprietor” or as a natural person doing business as themselves .
The complaint asserts that BHG’s loan documents unlawfully barred borrower prepayments for a certain period and stipulated that the loan was secured by all of the plaintiff’s property, including their home. Such practices allegedly allowed BHG and Pinnacle Bank to boost their shared assets and revenues significantly at the expense of tens of thousands of individual consumers nationwide.
Dismissal of Previous Class Action and Ongoing Legal Challenges
A previously proposed class action lawsuit against BHG was voluntarily dismissed by the law firm pursuing it in June 2024. However, other firms are reportedly considering new class actions against BHG, indicating ongoing legal challenges for the company .
BHG has also been involved in other legal disputes, including a discrimination lawsuit filed in March 2023 by a former employee alleging age-based termination and pay disparities .
Conclusion
The lawsuits against Bankers Healthcare Group highlight significant concerns regarding lending practices that may exploit regulatory loopholes to the detriment of consumers. As legal proceedings continue, the outcomes may have broader implications for consumer protection laws and lending practices within the financial industry.
Consumers are advised to exercise caution and thoroughly review loan agreements, especially those labeled as business loans, to ensure compliance with applicable consumer protection laws.
