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A New York woman accuses Affirm Holdings, Inc of tricking consumers into purchasing more, and paying high fees later, with “buy now, pay later” (BNPL) payment plans, in a class action lawsuit lodged Monday.
Lead plaintiff, Judith Shephard, wants to represent other New York consumers who were allegedly duped into Affirm BNPL payment plans that encourage higher spending and make returns tricky. She says the company’s practices violate New York consumer protection laws.
Shepard says that she relied on Affirm’s marketing when deciding between the company’s BNPL payment plan and using a traditional credit card to make certain purchases. She says that, as a result of Affirm’s deceptive marketing, she was hit with excessive fees. She also claims that the company failed to protect her interests in disputes with merchants participating in its BNPL payment plans.
Affirm offers reverse “layaway” payment plans that “encourages spending on items that otherwise could not be afforded,” explains the class action lawsuit. Under the plans, customers buy something and are then required to make payments until they have paid off that purchase.
Affirm partners with retailers and encourages spending on trendy clothing and jewelry, says the class action lawsuit. Shepard claims that Affirm’s “buy now, pay later” promises result in payments that are hard to track, resulting in high fees for consumers.
In addition, Affirm is unable to provide refunds, making it difficult for consumers to return defective items to the retailer, points out the plaintiff. Consumers who return items are still required to make installment payment to Affirm, alleges Shepard, and do not have the option to dispute the transaction as they would with a credit card company.
“Affirm touts itself as an alternative to ‘traditional’ lenders like credit cards, payday loans and banks,” states the class action lawsuit pointing out that the company targets millennials who mistrust credit cards. “However, the interest rates charged through Affirm exceed most credit cards, without any of the protections of this regulated form of payment.”
The class action lawsuit accuses Affirm of negligent misrepresentation, unjust enrichment, and violating New York general business law.
Shepard wants to represent other New York residents who made purchases using Affirm BNPL payment plans. She wants Affirm to pay damages to Class Members and stop its allegedly illegal marketing and payment plan practices.
Have you used Affirm payment plans to make a purchase? We want to hear from you! Tell us about your experience in the comment section below!
The lead plaintiff is represented by Spencer Sheehan of Sheehan & Associates, P.C.
The Affirm Deceptive Payment Plans Class Action Lawsuit is Shepard v. Affirm Holdings, Inc., Case No. 7:21-cv-05241 in the U.S. District Court for the Southern District of New York.
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304 thoughts onAffirm ‘Buy Now, Pay Later’ Payment Plans Dupe Consumers, Says Class Action Lawsuit
I qualify for this lawsuit.
I don’t know how they run a credit rep6on you just from your email and phone but they did and it was not disclosed that they did! Will have to see if it affected my credit report. I never would have attempted to use it if I knew that.
Hello
I made a purchase that was 4k.
Payments immediately started. The item never shipped from the seller.
The seller consistently had reasons for item not shipping.
Have followed up and have documentation on 4 calls to affirm. I was told they would respond to
My claim of money back with in 3-5 business days.
They have never responded.
I have followed up.
It has been 3 months since original contact.
I am still making payments.
They are a scam.
Please include me in any class action or if you would like to contact me please let me know.
Affirm has the worst custom service ever, they have poor English skills and will direct you wrong. They take no accountability for their actions. I assure you this is. It the same Affirm you started with. They refuse to allow you to speak with supervisors you hear dogs barking in the back ground babies crying. Pay your bill and close your account while your credit is still good.
Don’t ever use this company to finance your purchases. Their loan practices are extremely questionable. If you return an item, Affirm posts the credit on the day they received the credit memo from the merchant, 2.5 weeks after the date you returned the item to the merchant, resulting in extra days of accumulated interest. They will also change your original agreed upon payment terms (like from 12 to 9 months) with out proper notice and a valid explanation.
I have been using affrim and would also like to be added to this law suit im in California
I live in Ohio returned 392$ in merchandise and Affirm has not taken off the items
WARNING! Affirm and texesexamprep.com are scammer businesses. Affirm love to participate and help scammers. They are scammer friendly. They assist scammers and they are corrupt. texesexamprep.com is a scam website. Affirm will take your money and assist the merchant whether you get the advertised service or not. DO NOT TRUST AFFIRM!
Does this Lawsuit extend to California
I am soo done with Affirm!! Not only do they charge you more than what your purchase price is, but this is the THIRD time an order on my account has been charged off for .01! The first time, my account was paid in full! I had a “0” balance, but they added $.01 to my account. I didn’t see it until I was sent a late payment reminder… it was $.04 when I logged in to see what was going on. I tried to pay it, but it said I couldn’t post less than a $1.00. So I tried to pay $1.00, but it said I couldn’t pay more than $.04. I called and spoke to someone who said anything under $1.00 automatically falls off. I left it alone. Then three months later, I receive a notice that my account has been charged off for a balance if $.49!!!! This has been an ongoing nightmare!!! This happened to two of my orders, and they just charged off the original order from 2 years ago in 2021, AGAIN this morning!!!
I am soo done with Affirm!! Not only do they charge you more Golf what old purchased, but this is the THIRD time an order on my account has been charged off for .01! The first time, my account was paid in full! I had a “0” balance, but they added $.01 to my account. I didn’t see it until I was sent a late payment reminder… it was $.04 when I logged in to see what was going on. I tried to pay it, but it said I couldn’t post less than a $1.00. So I tried to pay $1.00, but it said I couldn’t pay more than $.04. I called and spoke to someone who said anything under $1.00 automatically falls off. I left it alone. Then three months later, I receive a notice that my account has been charged off for a balance if $.49!!!! This has been an ongoing nightmare!!! This haired to two of my orders, and they just charged off the original order from 2 years ago in 2021, AGAIN this morning!!!
I used Affirm to pay for a service. The merchant uses Stripe to process payments. However, the payment processor Stripe closed the merchants account after I paid them using affirm. Therefore the merchant never was paid. So I paid them cash & relied on the payment processor Stripe to issue a refund. This was May 2022. Still no refund- Affirm doesn’t help with refunds. They tell u to contact the merchant. The merchant has requested a refund severed times. I filed a dispute with Affirm as they say if you cannot get anywhere with the merchant to contact them. I provided evidence to Affirm. They opened the dispute in June 2022. According to their terms they don’t accept payments during the dispute process. I still tried to pay but the system doesnt accept payments while you’re disputing. Well I just received the results which Affirm told me I’m responsible for the entire amount on Feb 1, 2023.
That’s fine, I’ll just go after the payment processor Stripe. But Feb 2, 2023 I received another email stating the account has been charged off due to non payment. How can I pay ? We were in a dispute. So Affirm violates their own terms. Anyway now my credit is ruined & I’ve been contacted by a collection agency. How can you tell me to pay on the 1st & on the 2nd say the account is charged off? I can’t afford the arbitration. Please help. I’m in California.