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DOJ proposes SCRA settlement for auto lender
On March 6, the DOJ announced it reached a proposed $80,000 settlement with a California-based indirect auto lending company for allegedly repossessing servicemembers’ vehicles in violation of the Servicemembers Civil Relief Act (SCRA). As previously covered by InfoBytes, the DOJ filed a lawsuit against the company in March 2018, alleging that an investigation revealed the company failed to have policies or practices in place to verify borrowers’ military status before repossessing vehicles. As such, the DOJ argued that the defendant may have repossessed vehicles of other servicemembers without obtaining the necessary court orders or verifying military status. The investigation was triggered after an Army Private submitted a complaint about the company to the DOJ in 2016. The proposed consent order would require the company to pay a $50,000 civil penalty and issue $30,000 in compensation to a different Army Specialist, whose credit, according to the DOJ, was severely damaged as a result of a repossession by the company. In addition, the company would be required to develop policies and procedures to ensure compliance with the SCRA in the future. The consent order has not yet been approved by the court.