Houston Independent Automobile Dealers Association October 2015 Issue: Sales Training | Page 9

The report, “Leveraging technology to empower mortgage consumers at closing” is available at:
http://files.consumerfinance.gov/f/201508_cfpb_leveraging-technology-to-empower-mortgageconsumers-at-closing.pdf
The CFPB’s report focused on mortgage lending, but some of its findings and conclusions might
well apply in the auto finance area, as well.
FTC Interested in Debt Collection. On August 6, the FTC announced the panels for its
September 29 Dallas meeting on debt collection. The FTC will host a similar meeting in Atlanta
on November 18. The FTC's first such meeting with debt collection industry leaders and
professionals was held in New York in June. The participants will discuss enforcement actions,
consumer complaints, compliance issues, and industry best practices. Both events are free and
open to the public.
News from the Complaint Department. On August 25, the CFPB released its second monthly
complaint report, which highlights trends in the complaint data the Bureau receives through its
Consumer Complaint Database. Car industry folks will have a hard time gleaning anything from
the report dealing specifically with auto financing. The monthly report includes complaint data
specific to certain companies, overall complaint volume and complaint volume by state, and
other trends in the data. Each month, the report spotlights complaints about a particular issue
and complaints from a particular geographic location. This month's report focuses on credit
reporting complaints and complaints from consumers in Los Angeles.
Pennsylvania AG Curbs “Free Range” Dealers. On July 30, the Pennsylvania Office of the
Attorney General announced that it obtained settlements with three dealerships and one
individual for advertising and selling used vehicles without a valid license. The attorney
general's office also alleged that the dealerships failed to use proper sales contracts and failed
to disclose their business names and addresses or use the word "dealer" within their ads on
Craigslist. One dealership also allegedly misrepresented the quality of its vehicles and failed to
disclose in writing any verbal representations made to customers. The settlements are the result
of a statewide task force that investigated used car dealerships.
Litigation
Consumer Leasing Act Not Applicable to Lease to Individual and Non-Profit
Organization: A non-profit organization and its chief executive officer leased a car from a
dealership. Later, the CEO sued the assignee of his lease and the dealership's sales manager
for violating the Consumer Leasing Act. The assignee moved to dismiss the complaint, and the
trial court grant ed the motion. The federal appellate court affirmed. The appellate court agreed
with the trial court that the CLA, which does not apply to a lease to an organization, did not
apply to the lease because there was no question that the non-profit was a co-lessee and that it
was an organization under the CLA. The appellate court noted that the fact that the CEO was a
natural person did not convert the lease into a consumer lease because when there is more
than one lessee, all lessees must be natural persons in order for a lease to be a consumer
lease. See Dixon v. Toyota Motor Credit Corporation, 2015 U.S. App. LEXIS 12732 (5th Cir.
(E.D. La.) July 23, 2015).
Borrowers Not Entitled to Remedy for Violations of Maryland's Repossession Notice
Requirements Unless They Had Repaid More than Principal Amount: Two individuals
bought cars under retail installment sale contracts governed by the Maryland Credit Grantor
Closed End Credit Provisions. When they defaulted, the creditors repossessed the cars and