On June 17, the Consumer Financial Protection Bureau (CFPB) announced that it had filed a complaint against a national automobile finance company over allegations that the finance company used illegal threats and deceptive tactics to collect debts from military servicemembers. The complaint alleges that the finance company violated the Consumer Financial Protection Act (CFPA) by threatening to tell servicemembers’ commanding officers that servicemembers’ indebtedness violated the Uniform Code of Military Justice and could subject the servicemember to disciplinary action. The complaint alleges that in some instances the finance company actually contacted delinquent servicemembers’ commanding officers, disclosing sensitive financial information without authorization. Although servicemembers’ contracts with the finance company included an addendum permitting the finance company to contact the servicemember’s employer or commanding officer, the complaint alleges that the servicemembers were unaware of the provision or the extent of the finance company’s contacts with commanding officers. The complaint also alleges that the finance company made various other misrepresentations to servicemembers, including representations regarding the finance company’s intent to file collection actions and the legal effects of servicemembers’ failure to pay their debts. As relief, the complaint seeks an injunction against future violations of the CFPA, as well as unspecified damages, consumer relief, disgorgement, civil money penalties, and enforcement costs.
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