CAVIAT EMPTOR: EXPOSING NON-DISCLOSURE
Legislators learn many things in the Land of the Midnight Sun. Today I learned, to my dismay, about automobile “dealer reserves” and “document fees.” What’s that? I hear you ask.
HB383 was heard in the House State Affairs Committee. We learned that “document fees” charged to car buyers are nothing less than unadulterated profit, with no relationship whatsoever with vehicle license and registration fees, or anything else other than padding the pockets of dealers.
Furthermore, when a car dealer arranges credit for the buyer at a local bank or credit union, the interest rate quoted is typically higher than what the buyer would pay if they went to the bank directly. Nothing is wrong with any of that – so long as it’s disclosed to the buyer.
During the hearing an interesting exchange took place among committee members and witnesses who testified. Excerpts follow:
Lynn: Question to Bill Sponsor - What’s the difference between these practices (non-disclosure) and misrepresentation?
Bill Sponsor – That’s a very good point actually. A lot of lawyers out there think it’s a very unresolved issue. ….
Committee Member: I’ve been manipulated (before) – it’s like that song that just won the Oscar the other night and …
Lynn: What song was that, I didn’t watch the show?
Committee Member: I’m not going to say what it is – check the article.
Lynn: Just as an aside, I don’t know what song you’re talking about, but it’s odd that we’re giving awards to songs that you can’t even mention in public testimony.
Car Dealer: I do believe there are many other industries with the exact same practices . . .
Lynn: (Well, perhaps so) but if you can’t try to fix a problem in one industry until we fix problems in every other industry in the world, we wouldn’t do any kind of legislation down here if we did that. We try to fix problems as they come before us in various bills, but to say we can’t fix anything until we fix everything else in the universe just doesn’t make common sense to me . . . Is it all or nothing?
Lynn: I have paid doc fees in the past, but I didn’t know it was pure profit … (This is) another thing where full disclosure is required – disclosure shouldn’t only be for legislators and elected officials, but also for people who’re doing business with the public for consumer protection.
Moral to all the above: Caveat Emptor (Buyer Beware)
HB383 was heard in the House State Affairs Committee. We learned that “document fees” charged to car buyers are nothing less than unadulterated profit, with no relationship whatsoever with vehicle license and registration fees, or anything else other than padding the pockets of dealers.
Furthermore, when a car dealer arranges credit for the buyer at a local bank or credit union, the interest rate quoted is typically higher than what the buyer would pay if they went to the bank directly. Nothing is wrong with any of that – so long as it’s disclosed to the buyer.
During the hearing an interesting exchange took place among committee members and witnesses who testified. Excerpts follow:
Lynn: Question to Bill Sponsor - What’s the difference between these practices (non-disclosure) and misrepresentation?
Bill Sponsor – That’s a very good point actually. A lot of lawyers out there think it’s a very unresolved issue. ….
Committee Member: I’ve been manipulated (before) – it’s like that song that just won the Oscar the other night and …
Lynn: What song was that, I didn’t watch the show?
Committee Member: I’m not going to say what it is – check the article.
Lynn: Just as an aside, I don’t know what song you’re talking about, but it’s odd that we’re giving awards to songs that you can’t even mention in public testimony.
Car Dealer: I do believe there are many other industries with the exact same practices . . .
Lynn: (Well, perhaps so) but if you can’t try to fix a problem in one industry until we fix problems in every other industry in the world, we wouldn’t do any kind of legislation down here if we did that. We try to fix problems as they come before us in various bills, but to say we can’t fix anything until we fix everything else in the universe just doesn’t make common sense to me . . . Is it all or nothing?
Lynn: I have paid doc fees in the past, but I didn’t know it was pure profit … (This is) another thing where full disclosure is required – disclosure shouldn’t only be for legislators and elected officials, but also for people who’re doing business with the public for consumer protection.
Moral to all the above: Caveat Emptor (Buyer Beware)
posted by Blogs by Rep Bob Lynn | 7:00 PM
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