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Inside this issue
CFPB 'Brain Drain' Continues
FTC Issues Revised Business Guide on Red Flags Identity Theft Rule
Will Nissan Ruin the Profit Party?
Credit Thaw
Chrysler Shifts Stance, Will Recall Jeeps
Japan Eyes Reform of Auto Market as Trade Talks Loom
Chrysler Announces Sponsorship to Support Needs of Small Businesses
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
CFPB 'Brain Drain' Continues

The CFPB's leadership ‘brain drain' seems to be continuing, with Politico reporting that Richard Hackett, the Bureau's Assistant Director for installment and liquidity lending markets, is planning to leave the CFPB later this summer. Just two weeks ago, we reported about the departures of three top CFPB officials to join the firm founded by former CFPB Deputy Director Raj Date. Rick works in the CFPB's research, markets and regulations group, where he has been overseeing installment loans, such as auto and student loans, as well as small dollar loans, including payday and auto title loans. Politico also reports that, according to two people “familiar with the situation,” Rick's responsibilities overseeing student and auto loans will be temporarily assigned to Rohit Chopra, the CFPB's student loan ombudsman, and Corey Stone, the CFPB's Assistant Director for deposits, cash, collections and reporting markets, will become responsible for smaller dollar loan markets on a permanent basis. His departure will represent a significant loss for the CFPB, particularly because he is one of the few CFPB attorneys with a strong industry background.
Source: CFPB Monitor (Ballard Spahr LLP)
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FTC Issues Revised Business Guide on Red Flags Identity Theft Rule

The Federal Trade Commission issued revised guidance designed to help businesses such as dealerships comply with the requirements of the Red Flags Rule, which protects consumers by requiring businesses to watch for and respond to warning signs or "red flags" of identity theft. Regulators explained that the guidance outlines which businesses — financial institutions and some creditors — are covered by the rule and what is required of businesses to protect consumers from identity theft. The FTC revised the rule late last year to more narrowly define the types of creditors subject to the rule's requirements. Under the revised rule, officials said a Red Flag program implemented by a dealer or finance company must have four parts. First, the program must include reasonable policies and procedures to identify signs — or red flags — of identity theft in the day-to-day operations of the business. Second, the program must be designed to detect the red flags of identity theft identified by the business. Third, the program must set out the actions the business will take upon detecting red flags. Finally, because the FTC contends identity theft is an ever-changing threat, a business must re-evaluate its program periodically to reflect new risks from this crime.
Source: Auto Remarketing
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Will Nissan Ruin the Profit Party?

Will Nissan ruin the party? Automakers are experiencing not only huge sales, but consumers are forking over unusually high prices. It's been the kind of climate that automakers could have barely imagined four years ago when the car market hit rock bottom. Now comes Nissan to ruin the party. The Japanese automaker, emboldened by a "take-no-prisoners approach to gaining U.S. market share," has cut prices on seven models and is boosting incentives, Bloomberg News reports. Needless to say, it's working. Nissan's sales rose 25% in May and the discounted Altima sedan beat Ford's Fusion. Now the question is will other automakers be forced to follow. And if they do, will it cut into profitability enough that the good times will come to an end -- even as consumers benefit from lower prices?
Source: USA Today
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Credit Thaw

Connecticut's auto finance industry is heating up. Just a few years after many Connecticut car dealers saw access to credit dry up following the 2008 financial crisis, banks are rushing back into the market flush with cash to finance inventory, real estate and consumer loans, industry experts say. Large, national banks that either tightened their purse strings or threatened to exit the market are reopening their loan spigots. And a major new player in auto financing — Ohio's Huntington Bancshares Inc. — is entering the Connecticut market for the first time. The credit thaw comes as many Connecticut auto dealers say they are experiencing a boost in sales, mirroring a national trend that could spell a bit of good news for a slow moving state economy. “The availability of consumer credit and commercial financing for the auto industry is good right now,” said James T. Fleming, president of the Connecticut Automotive Retailers Association.
Source: Hartford Business Journal (Hartford, Conn.)
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Chrysler Shifts Stance, Will Recall Jeeps

Chrysler Group LLC said on Tuesday it would recall 1.56 million older-model Jeeps with fuel tanks positioned behind the rear axle to resolve a dispute with federal regulators who said the vehicles posed an unacceptable risk of fires in rear-end crashes. The decision reverses the auto maker's previous rejection of a regulator's request to recall of as many as 2.7 million Jeeps. The recall covers 1993-1998 model year Jeep Grand Cherokee and 2002-2007 Jeep Liberty sport-utility vehicles. Chrysler said its dealers will install towing hitches on the back of vehicles that don't have them, putting more metal between the fuel tank and the rear of the car to absorb an impact. In addition, Chrysler said dealers would inspect and if needed replace at no cost to the owner non-Chrysler Mopar brand towing hitches on 1.14 million 1999-2004 Jeep Grand Cherokees. The National Highway Traffic Safety Administration said it would continue the nearly three-year-long inquiry, “pending the agency's review of the documents provided by Chrysler in its recall action.”
Source: The Wall Street Journal
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Japan Eyes Reform of Auto Market as Trade Talks Loom

Japan sees an urgency in overhauling policies that favor domestic industries such as automakers as it seeks to revive the economy and join talks on a Pacific-region trade deal, the government's ambassador to the United States said. "For the first time, people are seriously thinking that we need to change some things," Ambassador Kenichiro Sasae said today during a Bloomberg Government breakfast in Washington. "Otherwise we will become second-rate citizens of the world." Japanese Prime Minister Shinzo Abe is seeking to end 15 years of deflation in the world's third-largest economy through regulatory reform and fiscal and monetary stimulus policies that are known as Abenomics. Japan next month will join 11 nations negotiating the Trans-Pacific Partnership, a free-trade agreement that will create a region with annual economic output of $26 trillion. The American Automotive Policy Council, representing Ford Motor Co., General Motors and Chrysler Group, opposes Japan's inclusion in the talks, saying the government in Tokyo manipulates its currency to favor exports and shuts out foreign competitors.
Source: Bloomberg
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Chrysler Announces Sponsorship to Support Needs of Small Businesses

Small businesses make a big economic impact on American communities, and Chrysler Group says it's committed to meeting their transportation needs. The automaker has announced its support and sponsorship of Independent We Stand, a nationwide movement of independent businesses that promote the importance of small businesses to local communities and the economy as a whole. By providing perks and programs that help small businesses reduce total cost of ownership on their for-work vehicles, Chrysler is growing its commercial dealer network, BusinessLink. The BusinessLink dealer network has almost doubled in size over the last 15 months, to nearly 800 dealers.
Source: Auto Remarketing
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Quotable
"The industry is doing very well."

     --- Mike Lynch, president of Lynch Toyota in Manchester, Conn., commenting on rising auto sales, Hartford Business Journal, June 17


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