Social Finance, Inc., more commonly known as SoFi, is an American financial services provider offering refinancing for student loans, personal loans, and mortgages.
SoFi was founded in 2011 by Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady, four students who met at the Standford Graduate School of Business. These friends hoped to create a company that could provide more affordable options for those taking on debt to fund their education.
Also in 2016, SoFi launched SoFi at Work, an employee benefit program to reduce student debt and build financial wellness, and announced it has more than 600 corporate partners.
The FTC alleges that since at least April of 2016 the company made false statements about loan refinancing savings in television, print and internet advertisements. The FTC also alleges that the average savings SoFi advertised inflated the actual savings, sometimes even doubling it, by excluding large categories of consumers.
In addition to the misleading advertising, the FTC alleges that SoFi misrepresented when consumers would actually pay more under certain refinancing plans. Consumers who visited SoFi’s website and were pre-approved for a loan were often directed to a webpage that displayed the loan options for which they prequalified. The FTC alleges that the web page misrepresented the loan options for which consumers would pay more on a monthly basis or over the lifetime of the loan by falsely stating that consumer’s lifetime or monthly savings would be 0.00.
SoFi, neither admits nor denies any of the allegations. As part of the proposed settlement with the FTC, SoFi is prohibited from misrepresenting to consumers how much money consumers will save or have saved using SoFi’s products and from making any claims about any such savings unless they are backed up with reliable evidence.
The corporate office for SoFi is located in San Francisco, California.