Author: lfsuser

Shady Loan Companies Prey on Military Servicemembers by Skirting the Military Lending Act

Seven years after Congress banned payday-loan companies from charging exorbitant interest rates to service members, many of the nation’s military bases are surrounded by storefront lenders who charge high annual percentage rates, sometimes exceeding 400 percent.

The Military Lending Act sought to protect service members and their families from predatory loans. But in practice, the law has defined the types of covered loans so narrowly that it’s been all too easy for lenders to circumvent it. More at: http://www.propublica.org/article/on-victory-drive-soldiers-defeated-by-debt

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Forced Arbitration Kills the Right to Sue Big Companies

So-called forced arbitration clauses say that in the event of a dispute, you won’t be able to file a class-action suit. Instead, your dispute will be settled one-on-one in a private arbitration forum. These clauses are commonly inserted into terms of service agreements, which you must agree to if you want to use the product or service.

For years, this practice was prohibited by law in many states. But in 2011 the Supreme Court ruled in AT&T Mobility v. Concepcion that all state laws prohibiting forced arbitration clauses are preempted by the 1925 Federal Arbitration Act. And that opened the floodgates.

More at: http://www.dailyfinance.com/on/forced-arbitration-killing-class-action-lawsuits-tos-agreements/

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US Consumer Watchdog Expands Probe Into Auto Financing

The Consumer Financial Protection Bureau expanded its probe into the car loan industry by issuing subpoenas to auto lenders over the sale of financial products such as extended warranties, the Wall Street Journal reported, citing people familiar with the investigation.

The consumer bureau is investigating whether terms and prices for auto loans, as well as additional products like extra insurance, are properly disclosed. The probe follows a similar investigation into deceptive marketing practices by credit card companies, the Journal said. More at: http://www.reuters.com/article/2013/05/03/us-autolenders-probe-idUSBRE94207H20130503

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Driver Will Appeal Conviction for Looking at IPhone Map Application While Driving

“The Convicted Distracted Driver is sitting in a study carrel in the Cal State Fresno library, which, come to think of it, looks a little like a prison visiting room.

“I don’t relish that title,” said Steven Spriggs. ‘But that’s what I am.’

His crime: looking at his iPhone’s map application while driving.”

More at: http://www.latimes.com/news/local/la-me-abcarian-distracted-driving-20130426,0,769309,print.story

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121 Auto Dealers Sue CarFax for Anticompetitive Practices

CarFax, the provider of vehicle history reports, has been sued by a group of auto dealers for anticompetitive practices.

“Leonard Bellavia, the attorney leading the case, has been looking at Carfax’s practices for the past six months as a growing number of his dealer clients questioned the quality of Carfax’s reports.”

More at: http://www.fi-magazine.com/News/Story/2013/04/121-Dealers-File-50M-Suit-Against-Carfax.aspx?ref=FI-eNewsAlert-20130424&utm_source=Email&utm_medium=Enewsletter&prestitial=1

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Dealer Forgery

Automotive News, a magazine that caters to dealers, explains different types of forgery.

Excerpts:

Forgery can exist on any document. There are people who think forging a contract is the only forbidden act. Any other document, that’s “kind of OK” in a lot of people’s opinion. But it can be forgery on any document. It can be the spouse signing the other spouse’s name, if the F&I manager knowingly lets it take place. It could be using “signature on file” or “per phone” on documents instead of a signature. That’s OK on some credit card agreements, but not in F&I. Or it could just be someone in sales or in F&I signing.

Why do dealers do it?

They rationalize their felonies. There are two basic reasons, I guess. There could be a financial incentive. More commonly, I think, it could just be laziness. “I forgot to get the signature. I don’t want to call the customer back in. I’ll just do it myself.”

Read more: http://www.autonews.com/article/20130424/FINANCE_AND_INSURANCE/130429961/signing-a-customers-name-is-forgery-period&cciid=email-autonews-fandi#ixzz2RPWJFfdD

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New Case Outlaws Use of GPS Cell Phones While Driving

The appellate division of a California Superior Court has decided that the Vehicle Code section outlawing use of a cell phone without a handsfree device also outlaws use of the phone for virtually anything else.

“Our review of the statute?s plain language leads us to conclude that the primary evil sought to be avoided is the distraction the driver faces when using his or her hands to operate the phone. That distraction would be present whether the wireless telephone was being used as a telephone, a GPS navigator, a clock or a device for sending and receiving text messages and emails. “

More at: http://www.metnews.com/sos.cgi?0413//JAD13-02

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Explosion in Sub-Prime Auto Lending

The Fed has contributed to the explosion of sub-prime lending due to their activities.

Sub-prime lending encompasses “customers with an average credit score of 556 and average annual income of $38,393, according to the pitch book. These borrowers pay an average interest rate of 21.4 percent a year. (Median U.S. household income was an inflation-adjusted $50,054 in 2011, according to the Census Bureau. On the widely used FICO credit-scoring scale, produced by Fair Isaac Corp, 640 or less is considered subprime.)” Read more at: http://www.reuters.com/article/2013/04/03/us-usa-qe3-subprimeauto-special-report-idUSBRE9320ES20130403

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The Consumer Financial Protection Bureau Warns Banks of Auto Lending Suits

The U.S. Consumer Financial Protection Bureau has told at least four banks that it may sue them over vehicle loans and interest-rate markups by auto dealers that appear discriminatory, according to three people briefed on the matter.

At least four banks received letters from the CFPB last week giving them 15 days to provide an explanation, said the people, who asked not to be identified because the plans aren’t public. The letters indicate the bureau believes the banks may have violated the Equal Credit Opportunity Act, a 1974 law that bars discrimination in lending.

More at : http://www.bloomberg.com/news/2013-02-21/consumer-bureau-said-to-warn-banks-of-auto-lending-suits.html

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