GNYADA February 2016 Newsletter

CFPB Reformation Bill Awaits Senate Review

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the CFPB’s ability to enforce fair credit laws in auto financing through financial institutions. Rather, it nulli- fies the Bureau’s 2013 guidance on indirect auto lending — that report alleged customer loan bias based on racial discrimination, which was the basis for the CFPB’s claim that it needed to oversee dealer financing. The Guinta-Perlmutter bill also man- dates safeguards that CFPB failed to follow in putting forth that bulletin, such as public participation and trans- parency. The important passage resulted from years of hard work on the part of dealers nationwide, as well as NADA, GNYADA and other state associations. GNYADA meets contin- uously with New York Congressional members and Senators urging them to help block the CFPB’s grab for total control over a critical step in car buy- ing. House support for this bill was also notably bipartisan, with 244 Republicans and 88 Democrats voting in favor.

As has been reported , the House of Representatives overwhelmingly approved H.R. 1737 on November 18 of last year. The bill reforming the CFPB’s influence over dealer assisted financing, also known as the “Reforming CFPB Indirect Auto Financing Guidance Act,” was adopt- ed in a 332-96 landslide vote.

to the Senate, where the bill awaits review by that chamber's committee on Banking, Housing, and Urban Affairs. New York Senator Charles Schumer is a member of this impor- tant committee, as is Senator Elizabeth Warren. Introduced by Representatives Frank Guinta (R-N.H.) and Ed Perlmutter (D-Colo.), the bill does not restrict

GNYADA will continue monitoring this bill’s activity in the Senate.

Focus on this issue has since shifted

WardsAuto.com Supports Dealer Financing

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GNYADA would like to commend Steven Finlay of WardsAuto on his recent article, Shocking News: Dealers Don’t Give It Away . Steven's article is a straightforward explana- tion of the dealership business model. He focuses particularly on dealer assisted financing, a practice that's routinely misrepresented and misun- derstood.

of detailing the kind of services deal- ers perform and the fees that are asso- ciated with them. Finlay draws paral- lels to the fuel and food sales indus- tries, which also involve middleman service fees, and correctly concludes that this is a noncontroversial, indus- try-wide trend. Importantly, this article is also a fair- ly devastating takedown of Elizabeth Warren’s claim that consumers are

being unethically swindled whenever they buy a car, as well as her contest- ed figure of $26 billion that dealers supposedly pocket as a result. We strongly encourage our members to read this interesting and meaning- ful piece: wardsauto.com/f-i/shock- ing-news-dealers-don-t-give-it-away.

The January 4 article does a great job

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • February 2016 7