CFPB hits SNAAC with another $1.25M CMP

The CFPB took another smack at SNAAC - - Security National Automotive Acceptance Company -- with a consent order that the Ohio-based auto lender specializing in loans to servicemembers, for failing to comply with the Bureau's October 28, 2015, Administrative Order by failing to provide more than $1 million in refunds and credits to more than 1,000 consumers. Under the 2015 order, SNAAC paid a $1 million civil penalty and was to make approximately $2.28 million in redress payments. [CFPB orders auto lender to pay $3.28 million, October 28, 2015]. The Bureau's April 26, 2017, press release reports that SNACC treated accounts that were settled-in-full as having a positive account balance instead of providing refunds. These "account credits" were worthless to consumers who no longer owed SNAAC money and couldn't use the credits toward another loan with SNAAC. SNAAC gave consumers whose accounts were discharged in bankruptcy the same worthless credits.

To ensure that redress payments will be properly delivered, the Bureau has now ordered SNAAC to pay the funds to the Bureau for redistribution to the consumers involved, along with a fee of $75,000 to the Bureau to cover the Bureau's costs involved. In addition, SNAAC must pay an additional civil money penalty of $1.25 million to the Bureau's Civil Penalty Fund.