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November 20, 2015 FacebookTwitterFlickrRSSSEND TO A FRIENDPRINT
Inside this issue
JD Power Study Shows Trade-Inís Devalued Dramatically Under Over-Broad Recall Policy
Bill Aimed at Repealing CFPB Auto Finance Guidance Passes House
Errors Abound in CFPB's Complaint Portal
Obama's Consumer Watchdogs Cash In
NADA Convention: Early Bird Registration Ends Nov. 27
Top Stories
JD Power Study Shows Trade-Inís Devalued Dramatically Under Over-Broad Recall Policy

The National Automobile Dealers Association (NADA) today announced a report that it commissioned from J.D. Power showing that many consumers could see the value of their vehicle trade-ins decline by an average of $1,210 - and by as much as $5,713 - if auto dealers were prohibited from selling any used vehicles with open recalls. The J.D. Power study, entitled "An Economic Assessment of Trade-In Value Reduction Caused by Preventing Auto Dealers from Selling Passenger Vehicles with any Open Recall," concluded that the enactment of legislation - including the "Used Car Safety Recall Repair Act," proposed by Sen. Richard Blumenthal (D-Conn.) - requiring auto dealers to fix all outstanding safety recalls before selling or leasing any used passenger motor vehicle could have an adverse impact on the value of those trade-ins.
Source: NADA
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Bill Aimed at Repealing CFPB Auto Finance Guidance Passes House

Legislation aimed at repealing the Consumer Financial Protection Bureau (CFPB)’s March 2013 guidance on dealer participation took another step toward reaching President Barack Obama’s desk, where it’s likely to be vetoed. H.R. 1737, the “Reforming CFPB Indirect Auto Financing Guidance Act,” was approved [Wednesday] by a 332-96 House of Representatives vote — Democrats accounting for all the “Nay” votes. But the bill, which would also add new steps to the bureau’s guidance-writing activities, also received approval from 88 House Democrats. One Republican and four Democrats did not vote. The House’s passage of H.R. 1737 comes more than four months after the legislation, introduced by Reps. Frank Guinta (R-N.H.) and Ed Perimutter (D-Colo.) this past April, was approved by the House Financial Services Committee by a bipartisan 47-10 vote. The bill, which currently has 166 co-sponsors, including 65 democrats, now heads to the U.S. Senate, where insiders believe it faces some hurdles.
Source: F&I and Showroom

Editor's note: NADA encourages dealers to thank those members of Congress who voted in support of H.R. 1737, in particular the sponsors, Reps. Frank Guinta (R-N.H.) and Ed Perlmutter (D-Colo.), and the following members who spoke in support of H.R. 1737 on the House floor: Jeb Hensarling (R-Texas), Scott Garrett (R-N.J.), Luke Messer (R-Ind.), Marlin Stutzman (R-Ind.), Ruben Hinojosa (D-Texas), David Scott (D-Ga.), Roger Williams (R-Texas), French Hill, (R-Ark.), and Mike Kelly (R-Pa.). To see how your member of Congress voted, click here for the state by state list.
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Errors Abound in CFPB's Complaint Portal

The Consumer Financial Protection Bureau's consumer complaint database is riddled with errors and distrusted by some of its own employees, according to internal documents and interviews with current and former agency officials/ In one instance, a single complaint was counted as 35 different ones, while in another example a complaint was filed against a bank even though the consumer sending it was actually complaining about an unrelated payday lender. While the CFPB argues any mistakes are minor and limited in scope, they are worrisome to agency officials because of how much the CFPB is guided by consumer complaints. The agency uses them as a partial basis for industry guidance, rulemaking and enforcement actions. But in interviews with five current and former CFPB officials — most of whom would only speak anonymously due to sensitivity around the issue — they said they are afraid to rely on the data.
Source: American Banker
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Obama's Consumer Watchdogs Cash In

Corporate giants are hiring away officials from the Consumer Financial Protection Bureau (CFPB), gaining inside knowledge of an agency that was created to police their bad behavior. At least 45 former CFPB employees, ranging from investigators and enforcement attorneys to higher-ranking officials who ran the agency, have departed to work at law or consulting firms, corporations and nonprofits since the agency opened its doors in 2011. A dozen people left the agency for the private sector in 2015 alone. Titans such as JPMorgan Chase, U.S. Bank, Wells Fargo, PricewaterhouseCoopers, PayPal, BlackRock and Bank of America all have former CFPB officials on their payrolls. So do elite K Street firms such as Arnold & Porter, Hudson Cook, Covington & Burling, K&L Gates, DLA Piper, Venable and WilmerHale. Consulting firm Promontory Financial Group and the Center for Responsible Lending, a nonprofit that pushes for stricter consumer protections, have several. While none appear to be registered lobbyists, many still work closely with the entities under CFPB supervision. Critics say the staff exodus from the four-year-old agency shows that the CFPB is falling victim to the same tactics that have taken the sting out of Washington’s other regulatory agencies.
Source: The Hill
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NADA Convention: Early Bird Registration Ends Nov. 27

Attendees who register for the 2016 NADA Convention & Expo in Las Vegas by Friday, Nov. 27, will receive a $100 discount from the on-site rate.

Considered the “Automotive Industry Event of the Year,” the NADA convention includes dealer-manufacturer franchise meetings, new educational workshops for dealers and managers, hundreds of exhibitors on the expo floor showcasing the latest equipment, services and technologies for dealerships and numerous networking events for attendees.

The NADA convention—which runs from Thursday, March 31, through Sunday, April 3, 2016—will be held at the Las Vegas Convention Center.

The American Truck Dealers (ATD) Convention & Expo runs concurrently with the NADA convention.

For more information or to register, visit www.nadaconvention.org.
Source: NADA
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Quotable
"I’m happy that both Democrats and Republicans have rallied around my bill, which would help qualified car buyers to purchase vehicles. If the CFPB truly cares about policies in the best interests of consumers, the agency should reissue guidance that is clear, fair and respects due process."

    -- Rep. Frank Guinta (R-N.H.), commenting on the U.S. House of Representatives passing H.R. 1737, F&I and Showroom, Nov. 19

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