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Automobile Fraud: NEVADA

Nev. Rev. Stat. § 482.554

Prohibited acts: A seller who enters into a vehicle sale contract on credit, exercises a valid option to cancel the vehicle sale, and then, after the customer returns the vehicle with no damage other than reasonable wear and tear, falsely represents that buyer must sign another sale contract on less favorable terms, or then fails to return trade-in or any other consideration in full, or then fails to supply the required disclosure prior to entering into a new agreement.

Required procedures: None specified.

Automobile Fraud: NEW YORK

N.Y. Pers. Prop. Law § 302 (McKinney)

Prohibited acts: Noncompliance with sale contract requirements.

Required procedures: No party to sign sale contract having blank spaces and all information required by federal Truth in Lending Act. Some blank spaces as to vehicle identification and date of first installment may be left blank if vehicle not yet delivered to buyer. Prior to delivery of required contract to buyer, buyer may rescind contract and receive complete refund of any down payment including trade-in.

Automobile Fraud: NORTH CAROLINA

N.C. Gen. Stat. § 20-75.1

Prohibited acts: None. Provides that other sections of North Carolina statutes do not prohibit a dealer from entering into a contract with any purchaser for sale of a vehicle and delivering the vehicle to the purchaser under terms by which the dealer’s obligation to execute the manufacturer’s certificate of origin or the certificate of title is conditioned on the purchaser obtaining financing for the purchase of the vehicle. Regulates insurance coverage for yo-yo sales.

Required procedures: None specified.

Automobile Fraud: NORTH DAKOTA

N.D. Cent. Code § 51-13-02

Prohibited acts: Noncompliance with sale contract requirements.

Required procedures: Sale contract to have no blank spaces and contain essential financial details as specified. Some blank spaces as to vehicle identification and date of first installment may be left blank if vehicle not yet delivered to buyer. Prior to delivery of required contract to buyer, buyer may rescind contract and receive complete refund of any down payment including trade-in.

Automobile Fraud: OHIO

Ohio Admin Code 109:4-3-16(B)(30)

Prohibited acts: Deliver a motor vehicle to a consumer pursuant to a sale which is contingent upon financing without a written agreement stating the parties’ obligations should such financing not be obtained.

Required procedures: Provide written agreement as to parties’ obligations should financing not be obtained.

Required notices: None specified.

Enforcement: Violation is a deceptive act or practice.

Automobile Fraud: PENNSYLVANIA

63 Pa. Stat. and Cons. Stat. Ann. §§ 818.102 (formerly § 818.2), 818.318 (formerly § 818.19) (West); 37 Pa. Code § 301.4

Prohibited acts: “Bushing,” defined as the practice of increasing vehicle’s selling price above that originally quoted the purchaser or decreasing the allowance for trade-in after buyer signs a purchase order or contract subject to subsequent acceptance by seller (§ 818.102). See also 37 Pa. Code § 301.4(a)(7), (8) (prohibiting increasing vehicle price or decreasing trade-in allowance).

Automobile Fraud: TEXAS

Tex. Fin. Code Ann. § 348.013 (West)

Prohibited acts: Failure to return trade-in and down payment (or trade-in’s stated cash value if it cannot be returned in same or substantially same condition) upon failure to convert conditional delivery agreement to retail installment contract.

Required procedures: Conditional delivery agreement is an enforceable contract but may not exceed term of 15 days. It does not confer any legal or equitable rights of ownership.

Automobile Fraud: UTAH

Utah Code Ann. §§ 41-3-401, 41-3-401.5 (leases) (West)

Prohibited acts: Failure to provide notices or comply with procedures as required.

Required procedures: On front page of sale contract contingent on financing dealer must provide required notice prior to releasing possession of vehicle, and subsequently must act within prescribed time limits. Full refund to buyer required if vehicle returned upon rescission.

Automobile Fraud: VERMONT

Vt. Stat. Ann. tit. 9, § 2355

Prohibited acts: Noncompliance with sale contract requirements.

Required procedures: Sale contract to have no blank spaces and contain essential financial details as specified. Some blank spaces as to vehicle identification and date of first installment may be left blank if vehicle not yet delivered to buyer. Prior to delivery of required contract to buyer, buyer may rescind contract and receive complete refund of any down payment including trade-in.

Automobile Fraud: VIRGINIA

Va. Code Ann. § 46.2-1530

Prohibited acts: Noncompliance with required procedures and notices.

Required procedures: Dealer must complete two buyer order forms, the original to be kept for five years, the duplicate to be provided to buyer during negotiation and prior to sale. A sample buyer order form including statement of any processing fee is to be filed with state Motor Vehicle Dealer Board with dealer licensing application.

Automobile Fraud: WISCONSIN

Wis. Stat. § 218.0116(1)(im) (sales and leases)

Prohibited acts: “Bushing,” defined as the practice of increasing vehicle’s selling price above that originally quoted purchaser as evidenced by a purchase order or contract signed by seller and buyer. For leases, an increase in the gross capitalized cost above that originally quoted the lessee as evidenced by a consumer lease or prelease agreement signed by lessee and dealer.

Required procedures: None specified.

Required notices: None specified.

Fair Credit Reporting: 9.2.5.1.2 Effect of a block

Once the CRA has received this information, the CRA must block the identified items from the consumer’s file within four business days.172 The CRA must also notify the furnisher of the blocked information about the block, that the information may have resulted from identity theft, and an identity theft report has been filed.173 These duties are in addition to a CRA’s duty to conduct its own “reasonable reinvestigation” to determine the accuracy or completeness of its reporting.

Fair Credit Reporting: 9.2.7.2.2 Scope: Application to “creditors”

In a guidance document interpreting these regulations, the FTC indicated that the red flag guidelines requirement applied not only to lenders, but other entities who could be considered “creditors” under the Equal Credit Opportunity Act (ECOA)288 including “professionals, such as lawyers or health care providers, who bill their clients after services are rendered.”289 Legislators became concerned that these businesses would be overburdened by the requirement to have red flag guidelines.

Fair Credit Reporting: 9.2.7.2.3 Requirements

Under the regulations, each creditor must “include reasonable policies and procedures” for issuing and implementing “Red Flag” guidelines regarding identity theft.296 A “Red Flag” is “a pattern, practice, or specific activity that indicates the possible existence of identity theft.”297 Financial institutions and creditors that maintain accounts described in the regulations must “develop and implement a written Identity Theft Prevention Program . . .

Fair Credit Reporting: 9.2.7.3 Address Discrepancies

One of the warning signs of identity theft is a discrepancy between the address on the credit application and the consumer report. For example, an identity thief will use the victim’s name and Social Security number to apply for credit cards, but have the cards sent to another address (after all, it makes no sense for the thief to have the cards sent to the victim’s address).

Fair Credit Reporting: 9.2.7.4 Change-of-Address Provisions

The FCRA specifically requires the FTC, the banking regulators, the SEC, and the CFTC to issue guidelines for credit and debit card issuers322 to prevent “account-takeover” identity theft. This provision imposes special verification procedures on issuers that receive a request for an additional or a replacement card on an existing account within thirty days of receiving a change of address notice.323 Before issuing the card, the issuer must do one of the following: