This week, the country celebrated those who served in the military by observing Veterans Day. Unfortunately, not everyone shows respect for those who risked lives for this country. An auto lender headquartered outside of New Jersey was recently ordered to refund or credit thousands of consumers, including many who are active-duty and former military members, because of its alleged illegal debt collection practices. The Consumer Financial Protection Bureau takes steps to stop harassing phone calls from creditors such as this one.
The CFPB accused Security National Automotive Acceptance Co. of using illegal tactics to collect delinquent auto loans. According to reports, the company would threaten soldiers with demotion, discharge and even the loss of their security clearances if they did not pay their debts. Some were told that their commanding officers would be contacted.
The company says that it is not admitting any wrongdoing, but it is willing to enter into a settlement with the CFPB. The company agreed to pay approximately $2.28 million in credits and refunds to consumers affected by the company’s allegedly aggressive collection tactics. In addition, it will pay a penalty of $1 million. A separate order requires the company to stop using illegal collection practices, such as threats, deception and exaggeration.
Many New Jersey consumers would do anything to stop harassing phone calls from creditors. A fact of which many are unaware is that creditors and debt collection agencies are supposed to follow certain federal laws when making contact with consumers. Consumers have rights and do not have to put up with abuse.
Source: kentucky.com, “US: Ohio-based auto lender used illegal collection practices“, Oct. 31, 2015
