Congress considers creating auto dealer watchdog

[rickaren]

Congress considers creating auto dealer watchdog

Posted Tuesday, Oct 13, 2009, 11:08 am in Employee News

A coalition of consumer groups wants a proposed federal watchdog agency to scrutinize the nation’s 20,000 auto dealers’ financing, The Detroit News reported.

The Obama administration and Democrats in Congress are working to overhaul the nation’s financial regulatory system in light of the collapse of major banks last year, the paper said.

“We strongly urge you to ensure that all activities of auto dealers related to the financing of cars are fully included under the jurisdiction of the (proposed) Consumer Financial Protection Agency,” said the letter from about 30 groups, including the Consumer Federation of America, Consumers Union, National Council of La Raza and Public Citizen, released Monday. “Consumers desperately need federal protection from ubiquitous predatory auto lending practices and multibillion-dollar auto sales frauds.”

The letter to Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, and Rep. Spencer Bachus, R-Ala., the ranking minority member, comes as dealers are urging Congress to exempt them from the new agency’s oversight, the paper said. On Sept. 22, Frank’s discussion draft exempted dealers from some new regulations—if buyers got their own financing or paid cash. The Obama administration’s proposal called for regulating all dealer transactions, the story said. (The Detroit News)