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September 18, 2015 FacebookTwitterFlickrRSSSEND TO A FRIENDPRINT
Inside this issue
CFPB Overestimates Potential Discrimination, Documents Show
U.S. Details $900M GM Ignition Settlement
Dealer Finance Company Fined For Violations of Fair Credit Reporting Act
Fiat Chrysler to Invest $5.3 Billion in U.S. Plants
Ford Designs Smartwatch App for Electric, Plug-In Hybrid Car Owners
NADA Foundation Spotlight: Enterprise Holding Foundation
Top Stories
CFPB Overestimates Potential Discrimination, Documents Show

The Consumer Financial Protection Bureau's method for detecting discrimination by indirect auto lenders can overestimate potential bias, resulting in higher payments for lenders cited by the agency, according to internal CFPB documents. In a series of private documents that were reviewed by American Banker, CFPB officials repeatedly acknowledge its methodology could over count the potential discrimination by firms, but say they prefer that to the alternative where bias is underestimated.

Industry representatives see the delay in refunds as proof that the CFPB overestimated the number of people Ally allegedly discriminated against. Doing so would mean that there are fewer consumers that were actually harmed by Ally's policies — and that the company paid more than it had to in order to fix the problem.

"In order to have an accurate measurement of potential consumer harm, you have to isolate out legitimate pricing factors that can cause a deviation in the results. There are business factors that the Justice Department has recognized as legitimate that the CFPB appears to be blatantly ignoring during investigations," said Paul Metrey, chief regulatory counsel at the National Automobile Dealers Association.
Source: American Banker

Editor’s note: This article highlights the need for the transparency that "public notice and comment" would provide if H.R. 1737 were enacted.  That process, combined with the NADA-NAMAD-AIADA Fair Credit Compliance Policy & Program (based on a Justice Department approach), would identify the most effective tools to address fair credit concerns without increasing the cost of auto financing for consumers.

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U.S. Details $900M GM Ignition Settlement

General Motors Co. overcame two major hurdles Thursday as it works to leave behind a crisis over deadly ignition switches that became the worst safety scandal in the company’s history. The automaker agreed to pay a $900 million fine with the Justice Department, and to three years of oversight by a federal monitor. On the same day, GM agreed to settle more than 1,000 civil claims and a class-action lawsuit.
Source: The Detroit News

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Dealer Finance Company Fined For Violations of Fair Credit Reporting Act

A dealer finance company was fined for failure to have written policies and procedures required under the Fair Credit Reporting Act’s so-called "Furnisher Rule." The Furnisher Rule applies to companies that report information about consumers to consumer reporting agencies, and requires those companies to maintain policies and procedures designed to ensure that the information they report is accurate and to allow consumers to dispute information they believe is inaccurate directly with the company that furnished the information.
Source: FTC

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Fiat Chrysler to Invest $5.3 Billion in U.S. Plants

Cars move to Mexico, truck and SUV production is shuffled amid U.S. plants, Wrangler adds pickup.

Fiat Chrysler Automobiles has made a commitment to invest $5.3 billion in its U.S. plants over the next four years as part of its new tentative agreement with the UAW that is sure to be jarring to employees at a number of plants in Michigan and the Midwest. The plant shuffle will includes the loss of at least three key new cars and SUVs moving to Mexico -- including the Chrysler 200 currently made in Sterling Heights -- while production of popular pickups and crossovers is increased in the U.S., the Free Press has learned. The automaker's investments would help the UAW secure thousands of jobs.
Source: Detroit Free Press
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Ford Designs Smartwatch App for Electric, Plug-In Hybrid Car Owners

The last time Ford CEO Mark Fields made a trek to the company's expanded Silicon Valley outpost, his wrist was brandishing a gleaming Apple Watch. Turns out, it wasn't just for tech bragging rights. Ford unveiled its MyFord Mobile app for both Apple Watch and Android Wear Thursday, which allows owners of electric or plug-in hybrid models -- C-MAX Energi, Ford Focus Electric and Ford Fusion Energi -- to access a suite of data from their wrists.
Source: USA Today
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NADA Foundation Spotlight: Enterprise Holding Foundation


Tom Gieseking (left), vice president of Enterprise Holdings Foundation, presents an NADA Ambassador grant to Stan Shoun, president of Ranken Technical College in St. Louis, Mo.

Since 2000, the Enterprise Holding Foundation has presented $7,500 in grants to the United Way of Greater St. Louis and Ranken Technical College in St. Louis through the National Automobile Dealers Charitable Foundation's Ambassador program. Enterprise Holdings Foundation is the charitable arm of Enterprise Rent-A-Car. 

Are you interested in joining the NADA Foundation's Ambassador program to support local organizations in your community? Click here to learn more.
Source: NADA Foundation
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Quotable
"In order to have an accurate measurement of potential consumer harm, you have to isolate out legitimate pricing factors that can cause a deviation in the results. There are business factors that the Justice Department has recognized as legitimate that the CFPB appears to be blatantly ignoring during investigations."

    -- Paul Metrey, NADA chief regulatory counsel, commenting in an American Banker article on one of the flaws in the methodology used by the CFPB to test for disparate impact, Sept. 17.

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