{ "id": 1472396, "name": "KETURAH D. CHANDLER et al., Plaintiffs-Appellants, v. AMERICAN GENERAL FINANCE, INC., et al., Defendants-Appellees", "name_abbreviation": "Chandler v. American General Finance, Inc.", "decision_date": "2002-03-27", "docket_number": "No. 1\u201401\u20142789", "first_page": "729", "last_page": "743", "citations": [ { "type": "official", "cite": "329 Ill. App. 3d 729" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "12 U.S.C. \u00a7 2601", "category": "laws:leg_statute", "reporter": "U.S.C.", "year": 1994, "pin_cites": [ { "page": "et seq." } ], "opinion_index": 0 }, { "cite": "755 N.E.2d 462", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 2001, "opinion_index": 0 }, { "cite": "197 Ill. 2d 39", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 259076 ], "weight": 2, "year": 2001, "pin_cites": [ { "page": "51-52" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/197/0039-01" ] }, { "cite": "713 N.E.2d 543", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1999, "opinion_index": 0 }, { "cite": "186 Ill. 2d 472", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 243943 ], "weight": 2, "year": 1999, "pin_cites": [ { "page": "478" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/186/0472-01" ] }, { "cite": "499 N.E.2d 440", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1968, "opinion_index": 0 }, { "cite": "114 Ill. 2d 1", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 5542333 ], "weight": 2, "year": 1968, "pin_cites": [ { "page": "17" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/114/0001-01" ] }, { "cite": "546 N.E.2d 33", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1989, "opinion_index": 0 }, { "cite": "190 Ill. 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App. 3d 843", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 5289361 ], "weight": 2, "year": 1991, "pin_cites": [ { "page": "857" }, { "page": "857" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/216/0843-01" ] }, { "cite": "134 F.3d 1321", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 11591569 ], "year": 1998, "pin_cites": [ { "page": "1322" } ], "opinion_index": 0, "case_paths": [ "/f3d/134/1321-01" ] }, { "cite": "952 F. Supp. 602", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 7779516 ], "year": 1996, "opinion_index": 0, "case_paths": [ "/f-supp/952/0602-01" ] }, { "cite": "938 F. Supp. 495", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 5653161 ], "year": 1996, "opinion_index": 0, "case_paths": [ "/f-supp/938/0495-01" ] }, { "cite": "18 U.S.C. \u00a7 1694", "category": "laws:leg_statute", "reporter": "U.S.C.", "year": 1994, "opinion_index": 0 }, { "cite": "94 C 4156", "category": "reporters:state", "reporter": "Cow.", "year": 1996, "opinion_index": 0 }, { "cite": "71 F.3d 1343", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 7416253 ], "weight": 9, "year": 1995, "pin_cites": [ { "page": "1345" }, { "page": "1345" }, { "page": "1348" }, { "page": "1348" }, { "page": "1346" }, { "page": "1347" }, { "page": "1348" }, { "page": "1347" } ], "opinion_index": 0, "case_paths": [ "/f3d/71/1343-01" ] }, { "cite": "695 N.E.2d 853", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1998, "opinion_index": 0 }, { "cite": "182 Ill. 2d 359", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 864532 ], "weight": 2, "year": 1998, "pin_cites": [ { "page": "373" }, { "page": "373" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/182/0359-01" ] }, { "cite": "726 N.E.2d 51", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 2000, "opinion_index": 0 }, { "cite": "311 Ill. 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CHANDLER et al., Plaintiffs-Appellants, v. AMERICAN GENERAL FINANCE, INC., et al., Defendants-Appellees." ], "opinions": [ { "text": "JUSTICE WOLFSON\ndelivered the opinion of the court:\nKeturah D. Chandler and Robert A. Chandler (the Chandlers) borrowed money from American General Finance, Inc. (AGFI), on June 1, 1998. After the Chandlers made some payments, AGFI began bombarding them with opportunities to borrow more money. They finally succumbed, on September 15, 1999.\nIn their lawsuit, the Chandlers claim they were victims of a bait- and-switch scheme. That is, AGFI led them to believe they would be getting a new loan but intended only to refinance their existing loan. Refinancing, they say, turns out to be more expensive than taking out a new loan.\nThe Chandlers brought this consumer class action under the Illinois Consumer Fraud and Deceptive Business Practices Act (Consumer Fraud Act) (815 ILCS 505/1 et seq. (West 1998)) and the Illinois Consumer Installment Loan Act (Consumer Loan Act) (205 ILCS 670/18 (West 1998)).\nAGFI filed a motion to dismiss, contending: (1) the Chandlers failed to state a cause of action under the Consumer Fraud Act; (2) the Chandlers failed to state a cause of action under the Consumer Loan Act; and (3) AGFI\u2019s conduct complied with the requirements of the federal Truth in Lending Act (TILA) (15 U.S.C. \u00a7 1601 et seq. (1994)), thus ruling out the Chandlers\u2019 state law claims.\nThe trial court dismissed the second amended complaint without opinion. On appeal, the Chandlers contend the trial court erred in dismissing their second amended complaint. We agree.\nWe reverse the trial court\u2019s order and remand this case for further proceedings.\nFACTS\nBecause the trial court dismissed the Chandlers\u2019 second amended complaint after AGFI brought a motion to dismiss pursuant to section 2 \u2014 615 of the Code of Civil Procedure (735 ILCS 5/2\u2014615 (West 1998)), we take the facts from the Chandlers\u2019 second amended complaint, and the exhibits attached to it, and accept them as true for the purpose of this appeal.\nOn June 1, 1998, the Chandlers received a loan from AGFI. The amount financed was $5,524.16. The Chandlers\u2019 automobile secured the note. The finance charge was $2,105.53 and the annual percentage rate was 21.30%.\nOf the amount financed, $109.91 was the premium for credit life insurance and $276.85 was the premium for credit disability insurance. Under the terms of the note, in the event of prepayment or acceleration, finance charges would be credited using the \u201cRule of 78\u2019s.\u201d A refund of unearned premiums on the insurance policies would also be computed using the Rule of 78\u2019s.\nAfter the Chandlers received the June 1, 1998, loan, AGFI began soliciting them to borrow additional money. Specifically, AGFI placed advertisements directly on the Chandlers\u2019 account statements and sent advertisement letters to them. The various solicitations on their account statements were standard form letters used by AGFI to solicit borrowers to borrow more money.\nThe Chandlers say AGFI\u2019s advertisements are \u201cdeceptive and misleading, in that *** they purport to be an offer for an additional loan\u201d and \u201cthey do not disclose that the borrower will refinance his or her existing obligation.\u201d The various solicitations on the Chandlers\u2019 account statements stated:\n\u201cSPLASH INTO CASH DURING OUR SUMMER CELEBRATION. WHATEVER YOUR PLANS ... LET US HELP WITH A HOME EQUITY LOAN YOU CAN HAVE THE CASH YOU NEED FOR A REALLY COOL SUMMER. COME IN ANYTIME FROM JULY 13 TO AUGUST 7 AND REGISTER TO WIN YOUR OWN DELUXE BEACH KIT. ALL LOANS SUBJECT TO OUR NORMAL CREDIT POLICIES.\u201d\n\u201cYOU COULD PAY OFF MONTHLY BILLS, TAKE CARE OF BACK-TO-SCHOOL EXPENSES AND STILL HAVE EXTRA CASH. WE\u2019LL SHOW YOU HOW TO PUT YOUR HOME EQUITY TO WORK.\u201d\n\u201cIF YOU\u2019RE PLANNING ON HOME IMPROVEMENTS TO MAKE YOUR HOME MORE COMFORTABLE THIS SUMMER ... WE\u2019LL BE HAPPY TO TELL YOU ABOUT THE BENEFITS OF A HOME EQUITY LOAN.\u201d\n\u201cDON\u2019T LET THE SUMMER SLIP AWAY WITHOUT A VACATION YOU\u2019LL REMEMBER FOR YEARS TO COME. ASK US HOW WE CAN HELP YOU GET AWAY THIS SUMMER.\u201d\n\u201cYOU\u2019RE INVITED TO STOP BY AND COOL OFF WITH COLD CASH FROM JULY 19-AUGUST 13. WE\u2019RE SERVING UP A SUPPLY OF COLD CASH FOR VACATIONS, HOME IMPROVEMENTS OR BACK-TO-SCHOOL EXPENSES. CALL *** TODAY TO SEE HOW MUCH WE CAN PUT \u2018ON ICE\u2019 FOR YOU.\u201d\nThe advertisement letters AGFI sent to the Chandlers are, in essence, the same as the solicitations in their account statements, except that the letters are a bit more personal. For example, in a letter dated September 7, 1999, AGFI said,\n\u201cDear Keturah,\nI am pleased to tell you that your loan account balance has been reduced enough that you may qualify for $1,200.*\nPlease call me at *** and I\u2019ll do all I can to meet your requirements for new appliances, home improvements, vacation spending, or other needs.\u201d\nThe Chandlers responded to AGFI\u2019s solicitations. Keturah Chandler called AGFI and asked about receiving an additional loan. A representative of AGFI gave Keturah the impression she would receive a \u201cnew\u201d loan. The representative allegedly \u201cnever mentioned the Chandlers\u2019 current loan in relation to the additional money sought to be borrowed.\u201d All the representative mentioned was that Keturah \u201ccould come after-hours to sign the loan documents\u201d and \u201cthat all that would be necessary was her signature.\u201d\nOn September 15, 1999, the Chandlers signed a new note with AGFI. \u201cInstead of simply making a new loan,\u201d said the amended complaint, \u201cAGFI presented the Chandlers with papers for a refinancing of the existing loan with additional funds being advanced. *** AGFI failed to disclose that it would be far more expensive for the Chandlers to refinance than to simply obtain a new loan.\u201d\nNow, the amount financed was $5,388.82, the finance charge was $2,026.75, and the annual percentage rate was 21.33% \u2014 the Chandlers\u2019 automobile still secured the note. Of the amount financed, $107.23 was the premium for credit life insurance and $439.56 was the premium for credit disability insurance. Under terms of the note, in the event of prepayment or acceleration, finance charges would be credited using the \u201cRule of 78\u2019s.\u201d A refund of unearned premiums on the insurance policies would also be computed using the Rule of 78\u2019s.\nThe Chandlers alleged: \u201cAGFI did not disclose to the Chandlers, when they entered into the September 15, 1999, transaction, that it would be substantially cheaper for them to simply obtain a second loan instead of refinancing the first loan.\u201d\nThe Chandlers say they did not realize AGFI had refinanced their original loan until the following day, September 16, 1999, when they told AGFI they wanted a \u201cnew loan.\u201d AGFI told the Chandlers they could not receive a new loan unless they returned the original check. The Chandlers were unable to return the check, however, because they had cashed it the night before. Consequently, AGFI denied the Chandlers\u2019 request to convert the additional loan money into a new loan.\nThe Chandlers set out the complained-of policies and practices of AGFI they say violated the Consumer Fraud Act and the Consumer Loan Act. They allege:\n\u201cIt was and is the policy and practice of AGFI to:\na. Repeatedly solicit for existing loans customers by mail to borrow additional funds.\nb. Use advertisements, such as Exhibits C & D, which lead the customer to believe that he or she is being offered a new and separate loan when in fact, that is not the case.\nc. Provide existing loan customers with additional funds through refinancing the original loans, rather than making new loans, with the result that the cost of the additional funds was inordinately and unconscionably expensive.\nd. Concealing from or omitting to reveal to the borrowers the fact that the advertisement was for a refinancing of the existing loan.\ne. Concealing from or omitting to reveal to the borrowers the fact that the cost of obtaining additional funds through refinancing was immensely greater than the cost of obtaining an additional loan.\nf. Market loans to mostly working-class borrowers who generally do not understand the computations necessary to determine the comparative costs of a new and separate loan and refinancing.\u201d\nDECISION\nSTANDARD OF REVIEW\nA section 2 \u2014 615 motion to dismiss attacks the legal sufficiency of a complaint. Lewis E. v. Spagnolo, 186 Ill. 2d 198, 710 N.E.2d 798 (1999). In ruling on the motion, the trial court must accept as true all well-pied facts in the complaint and all reasonable inferences that may be drawn from the facts. Connick v. Suzuki Motor Co., 174 Ill. 2d 482, 490, 675 N.E.2d 584 (1996).\nThe question for us to resolve is whether the allegations of the complaint, when viewed in the light most favorable to the plaintiff, are sufficient to state a cause of action upon which relief can be granted. Urbaitis v. Commonwealth Edison, 143 Ill. 2d 458, 475, 575 N.E.2d 548 (1991). A cause of action will not be dismissed on the pleadings unless it clearly appears no set of facts can be proved which will entitle the plaintiff to recover. Bryson v. News America Publications, Inc., 174 Ill. 2d 77, 86-87, 672 N.E.2d 1207 (1996). Our review is de novo. Vernon v. Schuster, 179 Ill. 2d 338, 344, 688 N.E.2d 1172 (1997).\nTHE CONSUMER FRAUD ACT CLAIM\nSection 2 of the Consumer Fraud Act:\n\u201cUnfair methods of competition and unfair or deceptive acts or practices, including but not limited to the use or employment of any deception, fraud, false pretense, false promise, misrepresentation or the concealment, suppression or omission of any material fact, with intent that others rely upon the concealment, suppression or omission of such material fact, *** in the conduct of any trade or commerce are hereby declared unlawful whether any person has in fact been misled, deceived or damaged thereby.\u201d 815 ILCS 505/2 (West 1996).\nAny person who suffers actual damage as a result of a violation of the Consumer Fraud Act may bring an action against the person who committed the violation. 815 ILCS 505/10a(a) (West 1996).\nWe construe the Consumer Fraud Act liberally to give effect to the legislative goals behind its enactment. Oliveira v. Amoco Oil Co., 311 Ill. App. 3d 886, 892, 726 N.E.2d 51 (2000). One of those goals is to give protection broader than afforded by common law fraud. Oliveira, 311 Ill. App. 3d at 892, citing 815 ILCS 505/2 (West 1996).\nAlthough the standard of proof for a violation of the Act is lenient, because it does not require \u201cany person has in fact been misled, deceived or damaged thereby\u201d (815 ILCS 505/2 (West 1996)), a complaint alleging a violation of the Consumer Fraud Act must be pied with the same particularity and specificity as that required under common law fraud. Oliveira, 311 Ill. App. 3d at 892.\nA cause of action under section 2 of the Consumer Fraud Act has three elements:\n(1) a deceptive act or practice by the defendant,\n(2) the defendant\u2019s intent that plaintiff rely on the deception, and\n(3) the deception occurred during a course of conduct involving trade or commerce. Zekman v. Direct American Marketers, Inc., 182 Ill. 2d 359, 373, 695 N.E.2d 853 (1998); Connick v. Suzuki Motor Co., 174 Ill. 2d 482, 501, 675 N.E.2d 584 (1996). The Consumer Fraud Act does not require actual reliance by the plaintiff on a defendant\u2019s deceptive act or practice. Connick, 174 Ill. 2d at 501.\nThe Chandlers key their Consumer Fraud Act claim to the advertisements in exhibit C and D attached to their second amended complaint and to AGFI\u2019s \u201cPOLICIES AND PRACTICES.\u201d Specifically, the Chandlers contend AGFI\u2019s policy and practice of \u201coffering plaintiffs a new loan and home equity loan\u201d through its advertisements/solicitations was fraudulent because (1) material facts were actively concealed, (2) material facts were omitted, and (3) ambiguous statements or half-truths were made.\nOur supreme court has said: \u201cAn omission or concealment of a material fact in the conduct of trade or commerce constitutes consumer fraud. [Citations.] A material fact exists where a buyer would have acted differently knowing the information, or if it concerned the type of information upon which a buyer would be expected to rely in making a decision whether to purchase. [Citation.] Furthermore, it is unnecessary to plead a common law duty to disclose in order to state a valid claim of consumer fraud based on an omission or concealment. [Citation.]\u201d Connick, 174 Ill. 2d at 504-05.\nThe Chandlers contend the omitted material fact, which, if known, would have caused them to act differently is that AGFI\u2019s advertisements actually were for the refinancing of their existing loan, that AGFI never intended to provide a new loan, and that \u201cthe cost of obtaining additional funds through refinancing was immensely greater than the cost of obtaining an additional loan.\u201d\nIn support of their contention, they cite Emery v. American General Finance, Inc., 71 F.3d 1343 (7th Cir. 1995), and Parish v. Beneficial Illinois, Inc., No. 94 C 4156 (N.D. Ill. April 10, 1996).\nEmery was a Racketeer Influenced and Corrupt Organizations Act (RICO) claim (18 U.S.C. \u00a7 1694 (1994)), based on mail fraud. Verna Emery borrowed money from American General Finance (AGF), and was making her payments on time. After about six months, AGF wrote her and told her it had more money for her if she wanted it. The letter said:\n\u201cDear Verna:\nI have extra spending money for you.\nDoes your car need a tune-up? Want to take a trip? Or, do you just want to pay off some of your bills? We can lend you money for whatever you need or want.\nYou\u2019re a good customer. To thank you for your business, I\u2019ve set aside $750.00* in your name.\nJust bring the coupon below into my office and if you qualify, we could write your check on the spot. Or, call ahead and I\u2019ll have the check waiting for you.\nMake this month great with extra cash. Call me today \u2014 I have money to loan.\n* Subject to our normal credit policies.\u201d (Emphasis added.) Emery, 71 F.3d at 1345.\nAt the bottom of the letter was a coupon captioned, \u201c \u2018$750.00 Cash Coupon\u2019 \u201d made out to her at her address. The small print explained, \u201c \u2018This is not a check.\u2019 \u201d Emery, 71 F.3d at 1345. Verna Emery wanted more money, and AGF refinanced her loan.\nAGF increased her monthly payment from $89.47 to $108.20 and gave her a check for $200, besides paying off her original loan. The cost to her came to about $1,200 paid over 3 years for the right to borrow $200. If she had taken out a new loan rather than refinancing her old one, it would have cost her roughly one-third less, which AGF did not disclose.\nAccording to the court, the letter sent to Emery made it appear AGF was offering a new loan. However, only after she went to AGF\u2019s office did Emery find out she was refinancing an old loan.\nEmery does not hold refinancing, standing alone, is fraud:\n\u201cWe do not hold that \u2018loan flipping\u2019 is fraud, because the boundaries of the term are obscure. We do not hold that American General Finance engaged in fraud, or even in \u2018loan flipping.\u2019 We do not hold that the mail fraud statute criminalizes sleazy sales tactics, which abound in a free commercial society.\u201d Emery, 71 F.3d at 1348.\nEmery does hold, however, the allegations of fraud in the plaintiffs complaint are sufficient to withstand a motion to dismiss for failure to state a claim under the mail fraud statute. Emery, 71 F.3d at 1348. Which allegations? Those that imply \u201cthe customer is being offered a separate loan, when the customer shows up to take advantage of the offer the company presents him with papers for refinancing the customer\u2019s existing loan with additional funds being advanced and does not disclose, indeed conceals the fact, that this method of obtaining additional funds is much more costly than taking out a new loan.\u201d Emery, 71 F.3d at 1346. That description fits the allegations in the Chandlers\u2019 amended complaint.\nOn remand, the district court twice dismissed the action because the plaintiff was unable to comply with the intricacies of RICO pleading. That is, the plaintiff could not plead two specific acts of mail fraud; nor could she plead a pattern of racketeering activity by separate entities. See Emery v. American General Finance Inc., 938 F. Supp. 495 (N.D. Ill. 1996); Emery v. American General Finance Inc., 952 F. Supp. 602 (N.D. Ill. 1996). The Court of Appeals affirmed the dismissal, leaving untouched and confirming its prior holding that the mailing similar to the letters in this case \u201cwas sufficiently misleading to make out, in conjunction with the allegations of the complaint, a violation of the mail fraud statute.\u201d Emery v. American General Finance Co., 134 F.3d 1321, 1322 (7th Cir. 1998).\nParish, which is factually similar to Emery, relied on Emery in holding the plaintiffs adequately alleged the elements of a claim under the Illinois Consumer Fraud Act.\nIn Parish, the plaintiffs alleged the defendant Beneficial Illinois was in the practice of defrauding unsophisticated consumers through a \u201cloan-flipping\u201d scheme. The Parishes described this scheme:\n\u201cA consumer takes out an initial loan with Beneficial Illinois and begins making timely payments as dictated by the original loan documents. After some unspecified period of time, the consumer receives a letter from Beneficial Illinois offering additional money. The letter states that the consumer is a \u2018great\u2019 customer in \u2018good standing,\u2019 and invites him or her to come in and receive additional funds. When the consumer arrives at Defendant\u2019s place of business and tenders the letter, Beneficial Illinois employees refinance the existing loan and reissue certain insurance policies incidental to it. Beneficial Illinois does not inform its customers that the cost of refinancing their loans is much greater than would be the cost of taking out a second loan or extending credit under the current loan.\u201d Parish, slip op. at_.\nThe Parishes alleged in detail two separate occasions on which they accepted Beneficial Illinois\u2019 offer of additional cash.\nAfter describing a \u201cdeceptive act or practice\u201d under the Consumer Fraud Act, the court held:\n\u201cThis court is satisfied that the loan-flipping scheme alleged by Plaintiffs falls into this broad description. Reading the allegations in the complaint in the light most favorable to Plaintiffs, Beneficial Illinois sent letters to a class of unsophisticated borrowers hoping to trick them into an outrageous refinancing that no knowledgeable consumer would accept. In Emery, Judge Posner did not hesitate to characterize the selfsame activity as fraud. 71 F.3d at 1347. Thus, Plaintiffs have alleged with adequacy the elements of a claim under the [Consumer Fraud Act].\u201d Slip op. at_.\nWe recognize a refusal to offer a separate new loan instead of a refinanced loan, even where the separate loan would cost the borrower significantly less, does not, by itself, constitute a scheme to defraud. See Emery, 71 F.3d at 1348. But we do not read the Chandlers\u2019 complaint to say offering the refinanced loan constituted the scheme. Rather, the complaint alleges that in the course of soliciting the Chandlers and providing the refinancing, the defendant neglected to say (1) it was offering to refinance the existing loan with a larger loan rather than provide a separate loan; (2) the refinancing would be considerably more expensive than providing a separate loan; and (3) it never intended to provide a new loan of any kind.\nAGFI contends the complaint never alleges any specific falsehoods or misleading half-truths by AGFI. It notes that, outside of the attachments, the complaint merely alleges AGFI solicited its customers to borrow more money. With regard to the attachments, AGFI contends their express words reveal nothing false or misleading. It argues that, in fact, the entire complaint fails to point to a single misleading phrase.\nWe believe Emery and Parish support a finding the Chandlers\u2019 second amended complaint states a claim for consumer fraud.\nThe financial sophistication of a borrower can be critically important. Emery found lack of sophistication relevant where the scheme revolved around the plaintiffs ability to access and understand financial disclosures under TILA. See Emery, 71 F.3d at 1347.\nThe misstatements, omissions, and half-truths the Chandlers refer to are contained in the advertisements and letters sent to their home by AGFI. The mailings contain repeated references to a \u201chome equity loan,\u201d which, allegedly, never was on the table. AGFI\u2019s images of a home equity loan, along with its invitations to \u201csplash into cash\u201d and to \u201cstop by and cool off with cold cash,\u201d could be read as an offer of a new loan \u2014 the bait \u2014 intended to induce a false belief by the Chandlers. Refinancing of the existing loan could be seen as the switch. Whether the facts will support the allegations is something we cannot determine at this time.\nIllinois courts have consistently held an advertisement is deceptive \u201cif it creates the likelihood of deception or has the capacity to deceive.\u201d People ex rel. Hartigan v. Knecht Services, Inc., 216 Ill. App. 3d 843, 857, 575 N.E.2d 1378 (1991); Williams v. Bruno Appliance & Furniture Mart, Inc., 62 Ill. App. 3d 219, 222, 379 N.E.2d 52 (1978). A plaintiff states a claim for relief under section 2 the Consumer Fraud Act if a trier of fact could reasonably determine that a \u201cdefendant had advertised goods with the intent not to sell them as advertised,\u201d that is, a bait-and-switch. Bruno Appliance, 62 Ill. App. 3d at 222.\nThe Chandlers\u2019 core allegation is AGFI engaged in \u201cbait and switch\u201d advertising. Bruno Appliance recognized that bait-and-switch sales tactics fall within the scope of the Consumer Fraud Act: bait- and-switch occurs when a seller makes \u201c \u2018an alluring but insincere offer to sell a product or service which the advertiser in truth does not intend or want to sell. Its purpose is to switch customers from buying the advertised merchandise, in order to sell something else, usually at a higher price or on a basis more advantageous to the advertiser.\u2019 \u201d Bruno Appliance, 62 Ill. App. 3d at 222-23, quoting 16 C.F.R. \u00a7 238 (1977).\nIn Bruno Appliance, the plaintiff had seen a furniture set consisting of a sofa, love seat, and lounge chair advertised for $298. When she went to the store, advertisement in hand, she was told the sofa alone was $298, and she was then urged to purchase different furniture which was not on sale. She did so and paid $462.20 for furniture other than that advertised. The likelihood of deception or the capacity to deceive was enough to find an advertisement deceptive on its face. The court held the allegations stated a claim under section 2 of the Consumer Fraud Act. Bruno Appliance, 62 Ill. App. 3d at 222.\nIn Garcia v. Overland Bond & Investment Co., 282 Ill. App. 3d 486, 489, 668 N.E.2d 199 (1996), the defendant\u2019s advertisements included statements such as \u201cNO MONEY DOWN,\u201d \u201cNO DOWN PAYMENT,\u201d \u201cEASY CREDIT,\u201d and \u201cINSTANT CREDIT\u201d and offered written guarantees and warranties.\nThe plaintiffs alleged the advertisements \u201ctarget unsophisticated, low-income buyers such as, inferentially, themselves.\u201d They alleged that after visiting the Car Credit Center in response to the various advertisements, they were induced to (1) make a down payment; (2) enter into retail installment agreement that required them to pay interest at a very high annual percentage rate, e.g., 33.11%; and (3) sign a bill of sale offering them \u201ceasy credit\u201d and assuring them they could return the vehicle if they did not like it. Garcia, 282 Ill. App. 3d at 489-90.\nAfter discovering various mechanical defects \u2014 \u201cdefects of such magnitude the Car Credit Center should have known about them\u201d\u2014 the plaintiffs returned their cars and asked for a replacement or refund. The Car Credit Center refused to take the car back, \u201con the pretense that the engine worked properly.\u201d Garcia, 282 Ill. App. 3d at 490.\nThe court held, if proved, the plaintiffs\u2019 allegations that the defendant advertised goods with an intent not to sell them as advertised constituted a basis for a claim of deceptive business practice under the Consumer Fraud Act. Garcia, 282 Ill. App. 3d at 492-93.\nThere is a common thread running through the allegations in this case and the cases we have cited \u2014 Emery, Parish, Bruno Appliance, and Garcia. In each, the targets are unsophisticated customers, attractive solicitations are aimed at them as a way of getting them in, the solicitor has no intention of delivering on the apparent promises, and, once there is contact, something different is delivered, something that is more costly.\nWe conclude the Chandlers allege fraud under the Consumer Fraud Act and the Consumer Loan Act. But even if they do, contends AGFI, there can be no cause of action because the Chandlers do not allege any actual injury arising from the alleged deception.\nAlthough the defendant\u2019s intent that its deception be relied on is an element, no actual reliance is required to state a cause of action under the Consumer Fraud Act. Connick, 174 Ill. 2d at 501. A plaintiff must demonstrate, however, the defendant\u2019s consumer fraud proximately caused his injuries. Zekman, 182 Ill. 2d at 373; Connick, 174 Ill. 2d at 501. The required allegation of proximate causation is minimal, because that determination is best left to the trier of fact. Connick, 174 Ill. 2d at 504.\nThe Chandlers contend their transaction resulted in extra costs that were effectively concealed by the defendant. They say a separate loan on the same terms would have cost them substantially less. The Chandlers assert that had this information been provided, they would not have entered into this transaction on the given terms.\nActual dollars lost by the Chandlers is a matter of proof, not pleading. See Miller v. William Chevrolet/Geo, Inc., 326 Ill. App. 3d 642, 654, 762 N.E.2d 1 (2001) (pleading value of car was diminished is sufficient). If AGFI wishes to present evidence the Chandlers would have accepted the refinancing on AGFI\u2019s terms anyway, it can do so at later stages of this case. See Downers Grove Volkswagen, Inc., v. Wigglesworth Imports, Inc., 190 Ill. App. 3d 524, 529-30, 546 N.E.2d 33 (1989).\nWe realize the total cost of the refinancing could not have been concealed: the loan documents made clear the monthly payments, the amount considered, the finance charge, and the insurance premiums. However, the Chandlers\u2019 Consumer Fraud Act claim does not assert they were unaware of the total amount they owed under the loan. Rather, they say their lack of financial sophistication prevented them from appreciating the inordinate cost of the refinancing. Enough actual damage caused by the deception is alleged to defeat the section 2 \u2014 615 motion to dismiss.\nTHE CONSUMER LOAN ACT CLAIM\nCount I of the Chandlers\u2019 second amended complaint alleges AGFI violated the Consumer Loan Act. The trial court dismissed that count.\nAGFI contends the trial court was correct in dismissing that count because the Chandlers failed to allege \u201chow the advertisement(s) at issue here were \u2018false,\u2019 \u2018misleading,\u2019 or \u2018deceptive,\u2019 \u201d and because AGFI\u2019s loan documents complied with TILA\u2019s disclosure requirements and, thus, cannot be a violation of the Consumer Loan Act.\nThe Consumer Loan Act says, \u201cAdvertising for loans transacted under this Act may not be false, misleading or deceptive.\u201d 205 ILCS 670/18 (West 1998). An advertisement is deceptive \u201cif it creates the likelihood of deception or has the capacity to deceive.\u201d People ex rel. Hartigan v. Knecht Services, Inc., 216 Ill. App. 3d 843, 857, 575 N.E.2d 1378 (1991); Williams v. Bruno Appliance & Furniture Mart, Inc., 62 Ill. App. 3d 219, 222, 379 N.E.2d 52 (1978).\nConsistent with our finding under the Consumer Fraud Act, we hold the Chandlers stated a claim for relief under section 18 of the Consumer Loan Act because a trier of fact could reasonably determine that AGFI \u201chad advertised goods with the intent not to sell them as advertised.\u201d Bruno Appliance, 62 Ill. App. 3d at 222.\nTHE TILA DEFENSE\nAGFI contends its compliance with federal and state disclosure requirements is a complete defense to the Chandlers\u2019 state-law claims. In support of its contention, AGFI cites Lanier v. Associates Fiance, Inc., 114 Ill. 2d 1, 499 N.E.2d 440 (1968), Weatherman v. Gary-Wheaton Bank of Fox Valley, N.A., 186 Ill. 2d 472, 713 N.E.2d 543 (1999), and Jackson v. South Holland Dodge, Inc., 197 Ill. 2d 39, 755 N.E.2d 462 (2001).\nThere is no question compliance with TILA, the federal act, precludes liability under the Consumer Fraud Act where the alleged fraud has something to do with disclosure in the loan documents.\nIn Lanier, the plaintiff contended the finance company\u2019s use of the Rule of 78\u2019s to compute interest in loans, to unsophisticated borrowers, absent an explanation about the effects of the rule on early repayment, was a common law fraud and violated the Consumer Fraud Act.\nIn Weatherman, the borrower contended the lender violated the Consumer Fraud Act when it provided, at the time of the loan application, a gross estimate of certain fees and costs but failed to inform the borrower of specific fees for recording the mortgage assignment after closing. Weatherman, 186 Ill. 2d at 478.\nAnd in Jackson, the car buyer claimed the finance company as-signee violated the Consumer Fraud Act where the loan documents falsely stated the amount of money paid to the assignee of the dealer for an extended warranty.\nIn each case, the defendant had complied with the federal disclosure acts \u2014 TILA in Lanier and Jackson, the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. \u00a7 2601 et seq. (1994)) in Weatherman. In each case, the supreme court held compliance with federal disclosure requirements was a bar to liability under the Consumer Fraud Act.\nHere, the Chandlers agree AGFI complied with TILA. But that compliance is not enough to defeat the Chandlers\u2019 Consumer Fraud Act and Consumer Loan Act claims.\nThe frauds alleged in Lanier, Weatherman, and Jackson centered on the actual loan transactions and the contents of the loan documents. For example, in Lanier:\n\u201c[W]e believe that the Consumer Fraud Act\u2019s general prohibition of fraud and misrepresentation in consumer transactions did not require more extensive disclosure in the plaintiff\u2019s loan agreement than the disclosure required by the comprehensive provisions of the Truth in Lending Act.\u201d (Emphasis added.) Lanier, 114 Ill. 2d at 17.\nThe bait-and-switch fraud alleged by the Chandlers extends beyond the loan agreement papers. It has nothing to do with the contents or omissions in the loan agreement papers. The fraud, if there was one, concerned AGFI\u2019s deceptive enticement of the Chandlers \u2014 false promises with no intent to deliver. TILA does not reach that kind of fraud.\nIn Jackson, the supreme court held:\n\u201cWe also agree with the appellate court that application of Lanier to this case does not confer a blanket immunization of assignees from liability under the Consumer Fraud Act. A plaintiff would be entitled to maintain a cause of action under the Consumer Fraud Act where the assignee\u2019s fraud is active and direct.\u201d Jackson, 197 Ill. 2d at 51-52.\nThe Chandlers have alleged an active and direct fraud, independent of and separate from the TILA exemption. Count I and count II are sufficient to withstand AGFI\u2019s motion to dismiss.\nCONCLUSION\nFor the reasons stated, we reverse the trial court\u2019s order dismissing count I and count II of plaintiffs\u2019 second amended complaint and we remand this case to the trial court for further proceedings.\nReversed and remanded.\nCERDA and SOUTH, JJ., concur.", "type": "majority", "author": "JUSTICE WOLFSON" } ], "attorneys": [ "Daniel A. Edelman, Cathleen M. Combs, James O. Latturner, Tara L. Goodwin, and Danita V Ivory, all of Edelman, Combs & Latturner, L.L.C., of Chicago, for appellants.", "Craig A. Varga and Paulette J. Cusick, both of Varga Berger Ledsky Hayes & Casey, of Chicago, for appellees." ], "corrections": "", "head_matter": "KETURAH D. CHANDLER et al., Plaintiffs-Appellants, v. AMERICAN GENERAL FINANCE, INC., et al., Defendants-Appellees.\nFirst District (3rd Division)\nNo. 1\u201401\u20142789\nOpinion filed March 27, 2002.\nDaniel A. Edelman, Cathleen M. Combs, James O. Latturner, Tara L. Goodwin, and Danita V Ivory, all of Edelman, Combs & Latturner, L.L.C., of Chicago, for appellants.\nCraig A. Varga and Paulette J. Cusick, both of Varga Berger Ledsky Hayes & Casey, of Chicago, for appellees." }, "file_name": "0729-01", "first_page_order": 747, "last_page_order": 761 }