The Consumer Financial Protection Bureau (CFPB) sued Security National Automotive Acceptance Company (SNAAC) today for allegedly implementing aggressive debt collection tactics against servicemembers, according to a CFPB press release.
Ohio-based SNAAC specializes in lending to servicemembers for used-car purchases. CFPB filed the complaint in U.S. District Court, alleging that SNAAC used “a combination of illegal threats and deceptive claims” to collect debts from servicemembers.
“Security National Automotive Acceptance Company took advantage of military rules to put enormous pressures on servicemembers to pay their debts,” said CFPB Director Richard Cordray. “For all the security they provide us, servicemembers should not have their financial and career security threatened by false information from an auto loan company.”
According to CFPB claim, once SNAAC consumers defaulted, they became subject to continuous threats to contact their chain of command. “In many other instances, the company exaggerated the consequences of not paying,” according to the press release.
CFPB alleges that SNAAC has:
- Exaggerated potential disciplinary action that servicemembers would face.
- Contacted and threatened to contact commanding officers to pressure servicemembers into repayment.
- Falsely threatened to garnish servicemembers’ wages.
- Misled servicemembers about imminent legal action.
“The CFPB is seeking compensation for harmed consumers, a civil penalty, and an order prohibiting the company from committing future violations,” according to the release.
