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American Financial Services Association

AFSA Pushes Back on FTC

AFSA Pushes Back on FTC

On September 12 AFSA submitted a comment letter on the Federal Trade Commission (FTC) proposed Motor Vehicle Dealers Trade Regulation Rule. The Consumer Bankers Association (CBA) also joined the letter.

The Rule designates a variety of vehicle dealer business practices as unlawful under the FTC’s authority to prohibit deceptive and unfair acts or practices.

The proposal would have negative effects on consumers, dealers, and the vehicle finance industry.

The Rule’s definition of “dealer” should clarify that vehicle finance companies are not subject to the Rule.  The Rule fails to address challenges that vehicle finance companies will have monitoring for compliance. While the Rule’s goal of prohibiting misrepresentations during the vehicle shopping process are laudable, vehicle finance companies will not be able to detect by looking at the retail installment sales contract or lease agreement when such violations occur. The Rule fails to appreciate the great strides toward accommodating consumers who wish to shop, finance, and purchase or lease a vehicle online.

In its comment letter AFSA offered suggestions to improve the Rule without negating the benefits to consumers that the FTC hopes to achieve. AFSA will continue to discuss the issues in the Rule with stakeholders at the relevant agencies and on the Hill.

September 14th, 2022 by

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