Tag Archive | "NADA"

House to Vote on CFPB-Altering Bill This Week


WASHINGTON, D.C. — The U.S. House of Representatives is expected to vote this week on a bill that would rescind the Consumers Financial Protection Bureau’s guidance on dealer participation and add a few more steps in to its guidance-writing activities.

The House is expected to vote on H.R. 1737, which the House Financial Services Committee passed this past July by a 47-10 vote, either on Wednesday or Thursday. It was introduced this past April by Rep. Frank Guinta (R-N.H.) and Ed Perlmutter (D-Colo.).

Aside from repealing the bureau’s March 2013 guidance on dealer participation, the legislation would require that the bureau provide a public comment period, consult with other agencies that share jurisdiction over the indirect auto finance market and disclose its testing methodologies before issuing any further guidance. The bill has received strong support from the National Automobile Dealers Association, which called on members this week to contact their local Congressperson to urge them to vote “Yes” on the bill.

“H.R. 1737 is a good-government bill that says to the CFPB, stay in your lane, make sure you understand the market, listen to the public, listen to the stakeholders — all of them — understand the implications of what you’re doing, understand what your actions do to consumers, and understand what they do to minority-owned businesses, women-owned businesses, and, in fact, all small business,” Andrew Koblenz, the NADA’s executive vice president of legal and regulatory affairs and general counsel, told F&I and Showroom this past September.

“And be transparent,” added Koblenz, who served as a keynote speaker at the magazine’s annual conference in September. “Tell us what you’re basing your analysis on, your conclusions on, and, to the extent you can, what your data shows. And coordinate with other agencies that have share responsibilities in this marketplace …”

Posted in Auto Industry NewsComments Off on House to Vote on CFPB-Altering Bill This Week

Colorado’s Jeff Carlson Elected NADA Chairman for 2016


PALM BEACH, Fla. — The National Automobile Dealers Association (NADA)’s board of directors has elected Jeff Carlson as chairman for 2016.

Carlson, who is currently serving as NADA vice chairman, is president of Glenwood Springs Ford and Glenwood Springs Subaru in Glenwood Springs, Colo., and co-owner of Summit Ford in Silverthorne, Colo. His term as chairman officially begins in January 2016. The ceremonial event of “passing the gavel” will occur at the 2016 NADA Convention and Expo in Las Vegas.

“This is a great honor, and I’m eager to lead NADA as we continue the important job of protecting the interests of America’s 16,500 franchised new-car dealerships, and the more than 1 million people they employ nationwide,” said Carlson, who represents Colorado’s new-car dealers on NADA’s board.

Mark Scarpelli, who represents Metropolitan Chicago’s new-car dealers on NADA’s board, was elected vice chairman. He is president of Raymond Chevrolet and Kia in Antioch, Ill., and is co-owner of Ray Chevrolet in Fox Lake, Ill.

Bill Willis, president of Willis Automotive Group (Chevrolet, Buick and Ford) in Smyrna, Del., was elected secretary. Neale Kuperman, president of Rockland Toyota in Blauvelt, N.Y., was elected treasurer.

The election took place at NADA’s board meeting in Palm Beach, Fla.

Posted in Auto Industry NewsComments (0)

NADA Files Second Request for Internal CFPB Documents


MCLEAN, Va. — The National Automobile Dealers Association (NADA) filed a Freedom of Information Act (FOIA) request today, asking the Consumer Financial Protection Bureau (CFPB) to release internal documents acknowledging that the agency intended to regulate the auto finance market through enforcement action, and eschewed evidence that its methods for estimating disparate impact were deeply flawed.

This is the second time in less than three months that the NADA has requested internal CFPB documents leaked to American Banker. A request filed in July asked that the bureau turn over documents that allegedly stated the CFPB’s “goal” in the auto lending arena was to significantly limit dealer discretion, despite the fact that the regulator is specifically prohibited from regulating auto dealers under the Dodd-Frank Wall Street Reform and Consumer Protection Act. The CFPB denied the NADA’s request three days later.

On Sept. 17 and Sept. 24, American Banker published articles that made numerous references to internal CFPB documents. Those documents supposedly show that the CFPB based its understanding of vehicle financing on a now-discredited study conducted by the Center for Responsible Lending. The bureau also allegedly acknowledged in the documents that the proxy methodology it uses to determine the presence of discrimination in auto lending is flawed, yet it continues to use the results to reach large settlements with finance companies like Honda Finance Corporation and Fifth Third Bank.

“These documents demonstrate a lack of transparency and accountability that should be deeply troubling to anyone concerned about how significantly a regulator can influence a market that affects millions of consumers,” said NADA President Peter Welch in a statement on the NADA’s website. “Consumers benefit tremendously from the discounts they get from dealers, and they have every right to demand that their voices be included in — not willfully excluded from — the debate about how to regulate the auto finance market.”

Earlier this month, during the bureau’s semi-annual report to Congress, CFPB Director Richard Cordray was challenged by lawmakers over the methods the bureau is using to bring enforcement actions against auto lenders. The regulator noted that “‘Accurate’ is in the eye of the beholder,” and that the CFPB is working to find the most reliable method possible to determine the presence of discrimination in auto lending.

However, Cordray was not forthcoming about the internal documents cited by American Banker, telling members of Congress he was only “roughly familiar” with the memos.

Posted in Auto Industry NewsComments (0)

CFPB Accused of Using ‘Junk Science’ to Regulate Auto Lending


WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB)’s Richard Cordray was met with hostility Tuesday as House Financial Services Committee Chairman Jeb Hensarling (R-Texas) attacked the “junk science” he said the bureau is using to impose regulations on indirect auto lending. The hearing occurred a day before the committee passed two bills aimed at reforming the bureau.

The CFPB has been pressuring auto lenders — most recently Fifth Third Bank — to cap the amount their dealer partners can mark up the interest rate on retail installment sales contracts as compensation for arranging a car buyer’s financing. The bureau alleges such practices result in minority car buyers paying higher rates for auto loans. But during the CFPB’s semi-annual report to Congress Tuesday, lawmakers repeatedly pointed to studies that show the CFPB’s method of determining the presence of discrimination in auto lending has high error rates.

Earlier this month, American Banker reported that internal CFPB documents acquired by the news source — including a memo from assistant director of the bureau’s Office of Fair Lending, Patrice Ficklin — indicate that bureau officials are aware that the agency’s methodology overestimates disparities.

“I believe I am roughly familiar with various memos I have seen,” Cordray said when asked about Ficklin’s memo during Tuesday’s hearing.

The director went on to say that “‘Accurate’ is in the eye of the beholder,” and that the regulator is working to find the most reliable method possible. Those methods, however, do not include taking the creditworthiness of car buyers into account.

“I don’t think it’s fair to say that credit scores can explain the disparities,” Cordray told Rep. Hensarling.

In its joint enforcement action with the Department of Justice Monday, the CFPB claimed that Fifth Third Bank’s dealer markup policy resulted in African American and Hispanic car buyers paying, on average, $200 more for car loans than similarly situated Caucasian customers.

“The CFPB have done some good things, but this business with the auto dealers is a bad thing,” said Rep. David Scott (D-Ga.) at Tuesday’s hearing. “… You based that on a report that was shamefully flawed, it was inaccurate, and to tell you the truth, it was downright insulting to African Americans because you just assumed our last name was Johnson or Williams or Robinson or maybe even Scott.”

The hearing preceded the House Financial Services Committee’s approval of two bills, H.R. 957 and H.R. 1266, that aim to restructure the CFPB to provide more transparency and oversight.

Sponsored by Rep. Steve Stivers (R-Ohio), H.R. 957 would create an independent inspector general for the bureau. That individual would be nominated by the president and confirmed by the senate. It passed the committee by a 56-3 vote.

H.R. 1266, which the committee passed by slimmer 35-24 vote, would remove the CFPB from within the Federal Reserve System and reestablish it as a standalone agency governed by a five-member, bipartisan commission. All powers of the CFPB would remain unchanged.

“Consumers are understandably concerned about our economy. We remain stuck in the worst recovery of the last 70 years,” said Hensarling after the committee’s approval of both bills. “At the same time, they’re concerned that Washington is taking away their choices and raising many of their costs. Our committee has the privilege — and responsibility — to fight for them.”

Testifying before the House Financial Service Committee, Cordray offered auto finance data countering the belief that the bureau’s activities have stunted market growth. In the first half of 2015, he noted, more than 14 million consumers obtained new auto loans, an 8% increase from a year ago.

“For auto loans, this marks a 45% increase since 2011 (when the bureau began operations) and a nine-year high,” he noted, with Rep. Maxine Water backing the bureau’s work during her opening statements at the hearing.

“It is unfortunate, however, that rather than working to encourage good behavior in our markets and support American consumers, opponents on this committee continue to promote measures to eliminate or weaken the bureau,” the lawmaker said. “They perpetuated false narratives of an agency that is unaccountable and lacks transparency despite the record number of times [Cordray has made himself] available to Congress and the many checks and balances contained in Dodd-Frank.

“So what we’re seeing now that the CPFB has celebrated its fourth birthday is that the dire predictions that the Republicans on this committee have made have not come true.”

Posted in Auto Industry NewsComments (0)

NADA Expands Effort to Protect Dealer-Assisted Financing


WASHINGTON, D.C. — The National Automobile Dealers Association (NADA) has launched a new initiative to highlight the true economic value of dealer-assisted financing, including video testimonials and a new website, officials announced this week.

On the new site, users can view testimonials from real consumers who benefited from receiving financing through a dealership.

“Consumers save money every day when they finance through dealerships, but that truth is getting lost in Washington, and that needs to change,” said NADA President Peter Welch. “The stories that we’re highlighting are far from unique. Dealers across the country save consumers money every day, and right now Washington is failing to understand what’s at stake for these consumers and millions more if competition is stifled and dealers are prevented from offering discounts on financing.”

In today’s vehicle finance market, local dealerships are able to shop a customer’s credit application to dozens of lenders all competing for the same loan. As a result, dealers usually offer better interest rates than consumers can find on their own. Furthermore, dealers have the ability to discount their rates to meet or beat a competing credit offer, which results in further savings for consumers.

“Most consumers know that financing is available at their local dealership, but what many don’t know is that dealer-assisted financing usually saves them money,” Welch added. “Many policymakers might not realize this either, but once the savings that comes from dealer discounting is made clear, it will be hard for Washington to turn a blind eye.”

The initiative is part of the NADA’s effort to stop the Consumer Financial Protection Bureau from restricting or eliminating the ability of dealers to provide competitive financing. The regulator has been targeting dealer markups, which it believes cause minorities to pay higher rates. But NADA officials have said the CFPB’s actions will have a negative effect on consumers’ ability to secure affordable auto loans.

Earlier this year, Reps. Frank Guinta (R-N.H.) and Ed Perlmutter (D-Colo.) introduced legislation — H.R. 1737 — that would promote transparency at the CFPB in order to help ensure that its policies do not unintentionally hurt consumers. In July, the legislation, which has 55 Democratic and 71 Republican cosponsors, passed the House Financial Services Committee on a 47-10 vote. The bipartisan vote included the support of 13 of the committee’s 26 Democrats, and House Republicans have indicated that the bill may come to the floor for a vote within the coming weeks.

“Our message is getting out, the facts are on our side, and people are starting to take notice,” Welch said. “But there’s too much at stake for consumers, so we don’t intend to take our foot off the gas until we know that consumer rights and consumer savings are adequately protected.”

Posted in Auto Industry NewsComments (0)

NADA Urges Dealers to Review FCC’s TCPA Ruling


WASHINGTON, D.C. — The National Automobile Dealers Association (NADA) is urging dealers to review their telephone and text marketing practices to ensure that they are in line with the Federal Communications Commission’s omnibus ruling and order regarding the Telephone Consumer Protection Act.

Issued on Friday, the ruling will affect a number of areas related to “autodialed” and pre-recorded telephone calls. Among the changes that could affect dealers, the NADA said this week, is the TCPA’s interpretation of the term “automatic telephone dialing system,” which encompasses “any technology with the capacity to dial random or sequential numbers.”

“The interpretation and several others in the order could require changes in dealers’ telephone and text messaging practices,” the NADA warned. “Dealers should review those practices and the system used to make calls and send text messages in light of these changes, and should consult with councel to ensure compliance with the new rulings.”

Dialing equipment that simply has the capacity to store or produce as well as dial random or sequential numbers would meet the TCPA’s definition of an autodialer. Predictive dialers also meet the definition of autodialer.

“Dialing equipment generally has the capacity to store or produce, and dial random or sequential numbers (and thus meets the TCPA’s definition of ‘autodialer’), even if it is not presently used for that purpose,” the commission said.

The ruling also puts the burden on the calling party to prove it obtained prior express consent should questions arise. It also requires that consent be obtained from the subscriber of the phone service, not the intended recipient of the call.

For telemarketing calls, prior-express-written consent requirements apply for each call made to a wireless number, rather than to a series of calls to wireless numbers made as part of a marketing campaign.

The commission also clarified whether telemarketers may make autodialed or prerecorded message calls to a wireless number that was initially linked to a wireline service. “Porting a telephone number from wireline service to wireless service does not revoke prior express consent,” the commission said. “If the consumer who gave consent to be called and later porter his wireline to wirless no longer wishes to be called because he may incur charges on his wireless number, it is the consumer’s prerogative and responsibility to revoke the consent.”

To review the FCC’s ruling, click here.

Posted in Auto Industry NewsComments Off on NADA Urges Dealers to Review FCC’s TCPA Ruling

Page 4 of 26« First...23456...1020...Last »