GNYADA March 2014 Newsletter

Direct Access to Legislators from GNYADA.com 4

name and address, and click submit, and you will see a message regarding that issue directed to your legislator. You can send it via email by clicking “submit” once more. If you have questions or need help with this process, please call Holly Montero or Stuart Rosenthal at 718.746.5900.

Inside the Legislation pages, you have an opportunity to look up your federal and state legislators. Click on any photograph, and you will have all the information you need to call, write, email or visit your legislator. If you click on the “Send an Email Now” button, you will find a detailed description of GNYADA’s latest legislative campaign. Fill in your

GNYADA is pleased to offer a new tool to help dealers find out who their legislators are, and to reach out to them to share their views. Legislator Lookup and Contact The dealer page on the GNYADA website now includes a “Legislation” tab. Go to the Dealer Homepage, www.GNYADA.com/dealer and click on the Legislation tab.

Guidance Available From NADA on Fair Lending

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reasons (from among several in the policy or others the dealer establish- es). The dealership has to record and document deviations from its pre-set compensation. It also establishes a periodic review process for managers to examine the documentation and take corrective action needed. NADA’s publication contains a brief overview and a template with instruc- tions. This is a voluntary program that dealers will have to modify to reflect their actual operations. Dealers should consult with legal counsel when mak- ing these decisions.

When Congress passed the Dodd- Frank Act, creating the Consumer Financial Protection Bureau (CFPB), dealerships were exempt from CFPB’s oversight. However, that agency has taken steps to impact deal- ers’ lending practices. The CFPB has issued “guidance” to automotive lenders regarding alleged- ly discriminatory lending by dealers. It also settled claims against Ally Financial that included a $90 million settlement.

Previously, members of Congress had sent bi-partisan, joint letters seeking answers from CFPB asking it to pro- duce the evidence it relied upon to arrive at its conclusions. After months without any satisfactory response from CFPB, the Financial Services Committee appears ready to get seri- ous on this issue. That letter asks, among other things, how and when CFPB decides there is a disparate impact, how it determines NADA Provides a Solution To assist dealers, the National Automobile Dealers Association (NADA) has issued its NADA Fair Credit Compliance Policy & Program , outlining best credit prac- tices and policies. It includes a fair credit policy and creates a framework for compliance with fair credit laws. Under the policy, dealers can establish a pre-set amount of compensation they will include in credit offers to every consumer, from which they will deviate only if there exists at least one pre-determined and pro-competitive

Congress Pushes CFPB for Answers

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that pricing differentials are attributa- ble to a consumer’s background, how it confirms comparisons are fair, and other specifics. A subpoena would require agreement by a majority of the Committee. If the agency failed to comply, Congress would have several options to force compliance, including a lawsuit.

U.S. House Financial Services Committee Chairman Jeb Hensarling (R-TX) has this month sent a letter to Consumer Financial Protection Bureau (CFPB) Director Richard Cordray threatening a Congressional subpoena unless CFPB provides detailed information regarding its con- troversial “guidance”, issued last year, in which CFPB warned automotive lenders that dealer reserves may vio- late the Equal Credit Opportunity Act (ECOA).

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

The Newsletter • March 2014 3