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- Published on Tuesday, 15 March 2016 15:29
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Hall of Shame: CFPB Orders CarHop to Pay $6.4 Million Penalty for Jeopardizing Consumers' Credit
The job of the most honest seller is to sell you, not to give you reasons to buy from a competitor. That over-riding reality drives the free-enterprise system, and places a responsibility on you.
FoolProof's Hall of Shame is here to remind you why a healthy dose of skepticism should rule your decisions before dealing with anyone who wants to touch your money or your general welfare.
December 17, 2015
"Many consumers went to CarHop because they needed transportation and wanted to build up a good record of paying their bills," said CFPB Director Richard Cordray. "But CarHop and Universal Acceptance Corporation thwarted those expectations by inaccurately furnishing negative credit information. The CFPB will not stand for companies whose sloppy actions jeopardize consumers' credit."
The CFPB found that CarHop and Universal Acceptance Corporation violated the Fair Credit Reporting Act and the Consumer Financial Protection Act. Specifically, the companies:
- Deceived consumers into believing they could build up good credit with CarHop
- Provided inaccurate repossession information
- Incorrectly reported previous customers as still owing money
- Failed to have reasonable written policies and procedures to ensure the accuracy of consumers' credit information
Under the terms of the CFPB orders released today, CarHop and Universal Acceptance Corporation must:
- Cease misrepresenting that they will report "good credit"
- Correct credit reporting information
- Provide credit reports to harmed consumers
- Implement an audit program to ensure laws are followed
- Pay a $6,465,000 civil penalty
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