Bessey Motor Sales, Inc Assurance of Discontinuance

December 19, 2018

STATE OF MAINE
BUREAU OF CONSUMER CREDIT PROTECTION
Docket # 2018- 0108
ASSURANCE OF DISCONTINUANCE

In re:

BESSEY MOTOR SALES, INC.
P.O. BOX H
209 MAIN STREET
SOUTH PARTS, ME 04281

Bessey Motor Sales, Inc. hereby makes the following assurance of discontinuance to the State of Maine Bureau of Consumer Credit Protection.

FACTS

l. The Maine Bureau of Consumer Credit Protection (the Bureau) is responsible for administering and enforcing the Maine consumer credit code, Title 9-A of the Maine Revised Statutes, and the Federal Truth-in-Lending Act and its implementing regulations, Regulation Z (l2 CFR part 1026), which have the force of law for creditors doing business in this State through Maine Regulation 02-030-240.

  1. Bessey Motor Sales, Inc. ("Bessey"), sells and finances new and used motor vehicles from an office in South Paris, Maine. It holds a registration as a "new car dealer", registration number NCD2143, with the Bureau.

  2. 9-A M.R.S. § 8-504(1) requires creditors to comply with the Federal Truth in Lending Act and its implementing regulations.

  3. 12 C.F.R. &en; 1026.24(d) states:

    1. Triggering terms. If any of the following terms is set forth in an advertisement, the advertisement shall meet the requirements of paragraph (d)(2) of this section:
      1. The amount or percentage of any downpayment.
      2. The number of payments or period of repayment.
      3. The amount of any payment.
      4. The amount of any finance charge.

  4. Additional terms. An advertisement stating any of the terms in paragraph (d)(l) of this section shall state the following terms, as applicable (an example of one or more typical extensions of credit with a statement of all the terms applicable to each may be used):
    1. The amount or percentage of the downpayment.
    2. The terms of repayment, which reflect the repayment obligations over the full term of the loan, including any balloon payment.
    3. The o'annual percentage rate," using that term, and, if the rate may be increased after consummation, that fact.

    1. Title 9-A M.R.S. § 3-201 states: "1. No creditor may engage in this State in false or misleading advertising concerning the terms or conditions of credit with respect to a consumer credit transaction or an open-end credit plan."

    2. 12 C.F.R. § l0l3.4(n) states:

    "For any consumer lease subject to this part, the lessor shall disclose the following information, as applicable: (n) Fees and taxes. The total dollar amount for all official and license fees, registration, title, or taxes required to be paid in connection with the lease."

    1. The Bureau has authority to examine the books and records of a creditor under Title 9-A M.R.S. § 6-106 and to charge the creditor the reasonable costs of such examination.

    2. The Bureau performed an examination of Bessey's records on April 19,2018' The examiner noted violations of 9-A M.R.S. § 3-201; 12 C.F.R. § 1026.24(d); and 12 C.F.R. § 1026.38 by failing to provide required closing disclosures required by the Federal Truth in Lending Act and Maine law.

    3. Pursuant to standard Bureau procedure, an examination report and invoice for the examination were mailed to Bessey on April 26, 2018.

    4. No response was received from Bessey. On July 10,2018 Principal Examiner Terry Fancy mailed a certified letter to Bessey requesting payment of the invoice.

    5. Said letter was received by Bessey on July 13, 2018.

    6. On September 18, 2018 Principal Examiner Fancy mailed a certified letter to Bessey requesting a response to the examination report of the April 19, 2018 examination. No response has been received as of November 6, 2018, to either the July 10, 2018 or September 18, 2018 letter.

    7. Bureau Rule 02-030 Chapter 190 section 4E states:

      1. Procedures for Corrective Action.
        1. Within 60 days of receipt by the creditor from the Administrator of the written notice of one or more alleged violations, the creditor shall:
          1. submit further information or documents relevant to a report of examination or notice of alleged violation which demonstrate to the Administrator that a violation has not occurred;
          2. by written notice to the Administrator, contest the written notice of alleged violations pursuant to subsection F; or
          3. proceed under subsection (E)(2) of this Section.

      2. With respect to a notice of alleged violation not contested by the creditor, the creditor shall, within 60 days of receipt, take the appropriate corrective action required by Section 5 of this Rule. Extension of this time period may be granted by the Administrator for good cause, but such extension shall not affect § 5-201(7) or § 8-208(2). Failure to comply with this paragraph shall automatically result in notification by the Bureau of the alleged violations to all parties to the transactions pursuant to subsection G.

    1. The Bureau is authorized to resolve issues relating to violations by accepting an assurance of discontinuance of the company's improper activities pursuant to Title 9-A M.R.S. § 6-109.

    WHEREFORE, Bessey assures the Bureau of Consumer Credit Protection as follows:

    Bessey acknowledges it has violated 9-A M.R.S. § 3-201; 12 C.F.R. § 1026.24(d); and 12 C.F.R. § 1013.4(n).

    Bessey acknowledges it has violated Bureau Rule 02-030 Chapter 190 section 4E;

    Bessey assures the Bureau that it shall cease and desist from such actions in the future;

    1. Bessey promises to undertake appropriate measures to ensure that its print, broadcast, and electronic advertising complies in the future with such regulations. This is to include proof-reading all print advertisements before they are printed; listening to and/or viewing all broadcast and electronic advertisements before they are aired and; monitoring advertisements once published or aired, and entering onto its website that information required by truth-in-leasing and truth-in-lending laws
    2. Bessey agrees to implement procedures to monitor more effectively its advertising to avoid errors such as occurred in this instance. Bessey will ensure that any advertisement for which it has contracted for publication, by print or broadcast media, or by electronic means, will be altered, as necessary, before publication or broadcast to comply with state and federal truth-in-leasing laws and truth-in-lending laws.

    Bessey shall pay the outstanding invoice from the Bureau in the amount of $319.64 dated April 19, 2018 within 10 days of the date this assurance is signed by Bessey;

    Bessey shall pay to the Bureau an additional sum of $350.00 for the Bureau's staff time in preparing the petition and assurance and in negotiating this assurance of discontinuance.

    Bessey acknowledges that any violation of this assurance of discontinuance will be a violation of Title 9-A M.R.S., the Maine Consumer Credit Code.

    Dated this day of December, 2018

    Bessey Motor Sales, Inc.
    l"xl-W 1U
    By:
    Its

    Bureau of Consumer Credit Protection

    By: William N. Lund
    Its Superintendent

    Attachments

    Bessey Motor Sales Inc AOD

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