Repossession of 113 vehicles and violations of vehicle-lease mandates are going to cost Nissan Motor Acceptance Corp. (NMAC) nearly $3 million.
The Department of Justice recently announced that NMAC has agreed to pay almost $3 million to resolve allegations that it violated the Servicemembers Civil Relief Act (SCRA). The suit alleged that NMAC repossessed 113 vehicles owned by SCRA-protected servicemembers without first obtaining the required court orders, and failed to refund up-front capitalized cost reduction (CCR) amounts to servicemembers who lawfully terminated their vehicle leases early after receiving military orders.
This settlement is the Justice Department’s 10th settlement with an auto-finance provider since 2015 and “exemplifies continued efforts” to enforce the SCRA’s vehicle repossession and lease termination provisions.
DOJ reiterated that the SCRA prohibits repossessing a vehicle from a servicemember during military service without a court order if the individual made a deposit or installment payment on the contract before entering military service. The SCRA also permits servicemembers to terminate vehicle leases early without penalty after entering military service or receiving qualifying military orders for a permanent change of station or to deploy.
When servicemembers lawfully terminate vehicle leases, the SCRA requires that they are to be refunded all lease amounts paid in advance for a period after the effective date of the termination.
The Justice Department acknowledged that individuals who lease vehicles from NMAC often have activities similar to what other captives orchestrate, including a contributing of an up-front monetary amount at lease signing in the form of a cash payment, credit for a trade-in vehicle, rebate or other credit. A portion of this up-front amount can be applied to the first-month’s payment and certain up-front costs such as licensing and registration fees.
The remainder, which is called the CCR amount, reduces the monthly payment the lessee must make over the term of the lease. The Justice Department’s investigation revealed that when servicemembers terminated their vehicle leases early pursuant to the SCRA, NMAC retained the entire CCR amount.
The agreement resolves a suit filed by the Department of Justice in the United States District Court for the Middle District of Tennessee. It covers all repossessions of servicemembers’ vehicles and leases terminated by servicemembers since Jan. 1, 2008.
The agreement requires NMAC to create a $2,937,971 settlement fund to compensate servicemembers whose rights were violated under the SCRA.
Additionally, NMAC must pay $62,029 to the United States Treasury.
The agreement also requires NMAC to revise its policies and procedures to prevent future unlawful repossessions of servicemembers’ vehicles and ensure that servicemembers who terminate their auto leases early receive a full refund of all eligible pre-paid CCR amounts.
NMAC must also provide training to its employees and representatives.
“Men and women in uniform risk their lives to serve our country, and Congress enacted the Servicemembers Civil Relief Act to protect them when they serve our nation,” assistant attorney general Eric Dreiband of the Justice Department’s Civil Rights Division said in a news release.
“The U.S. Department of Justice will continue to enforce the Act vigorously in order to protect servicemembers and to ensure that all covered industries comply fully with the law,” Dreiband continued.
“The SCRA exists to offer protections to our military service members and to minimize undue financial burdens associated with deployments and other instances where our military servicemembers experience a profound and prolonged lifestyle change,” added U.S. Attorney Don Cochran, who serves in the Middle District of Tennessee.
“We will aggressively hold those institutions and businesses accountable who are required to comply with the act. Our military deserves no less,” Cochran went on to say.
The American Recovery Association is looking to help members with one of the most important benefits repossession agencies can offer their employees.
This week, ARA, in partnership with Harding Brooks Insurance Agency, announced the newest member benefit: a national, cost-effective health insurance program open to all members.
“A rich benefits package is key in retaining quality employees and obtaining health insurance for small businesses has not always been an easy option,” ARA president Dave Kennedy said in a news release. “ARA is always working to find ways to add value to our membership, and we are thrilled to now offer a cost-effective insurance program for the recovery industry.”
Harding Brooks will serve as ARA’s one-stop-shop in an effort to ensure members are getting the best rates possible. This includes educating ARA members and staff on coverages, deductibles and co-pays while putting together the best plan from top healthcare providers across the country.
“Harding Brooks is excited to offer an exclusive health care policy for the collateral recovery industry,” said Mike Peplinski, vice president of Harding Brooks Insurance Agency. “I’d like to thank ARA for their assistance, which was instrumental in this process.”
Members should contact Peplinski at Harding Brooks at (315) 214-5822 to discuss which health care plan is the best option for their company and employees.
ARA also recently announced a guaranteed $10,000 ($20,000 accidental death, no questions asked) life insurance policy that covers every executive member, and coverage is available for all employees at cost.
More offerings are expected to roll out in the coming months, ARA said.
On Tuesday, KAR Auction Services shifted an executive from AFC to a role with PAR North America.
According to a news release, PAR announced Drew Shull was named vice president of sales and client experience.
In his new role, the company said Shull will focus on enhancing PAR’s client experience and product offerings, while leading the sales team. He and the sales team are responsible for executing on the company’s overall strategy, which includes implementing client retention initiatives, driving results and expanding PAR’s product portfolio.
PAR is a leading U.S. provider of vehicle transition services with coast-to-coast solutions for recovery management, skip-tracing, remarketing and title services. This appointment aims to help create new client relationships and foster PAR’s existing customer base.
“At PAR, we are working to transform the asset recovery industry and grow our footprint,” PAR North America Lisa Scott president said.
“With 19 years of sales experience, Drew’s proven track record of providing internal and external partners with value is just what PAR needs at this time in our industry. His passion and drive will help take PAR’s product and services to the next level.”
Prior to joining PAR, Shull served as regional manager at AFC where he led the 12-branch Midwest region with an automotive floorplan portfolio of $200 million. While at AFC, he coached and mentored branch managers on sales strategies, relationship building and integration of new products from the KAR Auction Services portfolio of brands. He also led the Mobility Branch, an international business opportunity for rental cars, fleet cars, rideshare and retail subscription programs.
The company added Shull served in various sales and financial roles before joining the KAR family.
Shull will be based in central Indiana and will report directly to Scott, according to the news release.
Experian discovered the nation’s leader in 60-day delinquency still is not within the Deep South.
Findings from the Q1 2019 State of the Automotive Finance Market report showed that while Louisiana and Mississippi still have some of the highest rates, analysts indicated that leading the country continues to be Maryland with a 60-day delinquency rate of 1.49%.
Those Gulf Coast states weren’t far off that leading pace as Experian pegged Mississippi’s rate at 1.19% and Louisiana’s reading at 1.13%.
Maryland tied with Mississippi for the highest rate to close 2018 as Experian noted each state’s 60-day delinquency rate stood at 1.68%
All told, Experian said the overall 60-day delinquency rate remained flat at 0.68% after the first quarter. Even what analysts classify as finance companies — institutions that offer auto financing but do not hold deposits or are associated with an automaker — watched their 60-day delinquency rate drop by 15 basis points year-over-year to settle at 1.45%. And finance companies often absorb the greatest risk by booking more subprime paper than banks, whose rate ticked up 4 basis points year-over-year to 0.67%
The 60-day delinquency rate for captives stood at 0.50% after Q1, down 3 basis points year-over-year. For credit unions, Experian noted their Q1 rate nearly stayed the same compared to a year earlier, edging a basis point lower to 0.29%.
Turning back to the state-level data, here are the top 10 rates for delinquency ripe for repossession, according to Experian:
1. Maryland: 1.49%
2. Mississippi: 1.19%
3. Louisiana: 1.13%
4. South Carolina: 0.95%
5. Georgia: 0.93%
6. Alabama: 0.89%
7. Nevada: 0.78%
8. Texas: 0.78%
9. Arkansas: 0.77%
10. North Carolina: 0.77%
In today’s world where it might seem the only auto-finance element lengthening in time involves terms of consumers’ retail installment sales contracts, Digital Recognition Network (DRN) and American Recovery Service (ARS) are reaching a significant milestone — their 10th anniversary of doing business together in the repossession and recovery spaces.
DRN executive vice president and general manager of fintech Jeremiah Wheeler shared with SubPrime Auto Finance News what it’s like to have a business relationship stretch to a decade.
“I believe it is fairly rare to have such a long-standing relationship with two companies because people and visions change,” Wheeler said. “The main driver behind our long-lasting partnership is the value we both bring to the industry and the process of repossession. We both understand the work that goes into the process of producing very larger returns for lenders.
“Our equal investment in technology to create higher returns for lenders and massive improvements to the agents’ process in the field are major pieces that bond us together,” Wheeler continued. “We will continue to innovate and grow together as we achieve the next level of milestones in this industry and look forward to the next 10 years of success.”
ARS and DRN’s partnership began in 2009 when ARS decided to embrace the use of license plate recognition (LPR) technology through a pilot program for a dispatch center leveraging DRN’s data and analytics. After the successful launch, both DRN and ARS realized the power of combining DRN’s data and analytics with ARS’s recovery operations to generate more revenue opportunities for recovery agents.
Since partnering, ARS has driven the recovery of more than 400,000 vehicles valued at $4.8 billion for auto finance companies. The company indicated those recoveries contributed to more than $110 million in revenue to the repossession agent and affiliate market.
ARS is DRN’s elite provider of live pick-up services.
“The relationship between ARS and DRN has been built on a foundation of a mutual commitment to teamwork and innovative technology,” ARS chief operating officer Dave Copeland said in a blog post on DRN’s website.
“Our mutual collaboration and integrated solutions have illustrated our dedication to delivering the best in class performance for our client partners. We truly value and appreciate the partnership we have built with DRN,” continued Copeland, whose company also is celebrating 25 years of operations in 2019.
After 10 years of working together, Wheeler added in that blog post, “DRN and ARS have cemented our spot at the forefront of revolutionizing the repossession industry by creating and adopting innovative technology to help advance our agents and the recoveries for their lenders. Congratulations, ARS, on your 25 years of excellence. We are excited to continue this partnership for many years to come.”
Wheeler and DRN — also a member of the Auto Intel Council — will be discussing business relationships, fintech and more this summer in Raleigh, N.C. Wheeler is one of a host of experts set to appear during the Automotive Intelligence Summit (AIS), which runs July 23-25.
AIS is gathering of professionals at the edge of technology in auto to provide ample networking opportunities to progress your business and make lasting professional connections. Companies range from firms such as MK & Associates and Deloitte, to digital retailing experts like MotoInsight and CarNow. An early bird registration discount is available through June 14. Registration can be completed here.
The complete AIS agenda and more details are available at www.autointelsummit.com.
Recovery Specialist Insurance Group (RSIG) and Allied Finance Adjusters are prepping for their annual gathering. REPO19 is set to begin on June 18 in Phoenix.
Among the collection of experts set to speak during the three-day event, organizers highlighted the agenda includes Jack Schafer, who is a retired FBI Special Agent in the Behavioral Analysis Program and now an assistant professor at Western Illinois University, along with Internet profiling expert Michelle Stuart, who is a trainer at the FBI Academy in Quantico, Va., as well as an adjunct professor at the University of Virginia.
The agenda also includes a panel discussion with a collection of finance companies as well as Allied Finance Adjusters business meetings.
The event will be held at the Arizona Grand Resort in Phoenix.
Complete details hotel reservations and conference registration can be found at repo19.com.
ALS Resolvion, a nationwide skip-trace and repossession management firm, has been selected as an honorable mention winner within Digital Defense’s 2018 Client Recognition Award Program, which recognizes organizations that display the highest level of network security.
This accolade arrived soon after ALS Resolvion was named the recipient of Digital Recognition Network’s 2019 Platinum Provider of the Year Award.
Out of 1,600 recurring vulnerability scanning and penetration testing clients, ALS Resolvion said in a news release that it was one of 48 presented with the honorable mention award.
“In this age of data breaches, it is encouraging to see our clients continuing to increase their focus on reducing risk by proactively mitigating network vulnerabilities,” Digital Defense president and chief executive officer Larry Hurtado said.
As one of the leading forwarding companies in the industry, ALS Resolvion works with sensitive information and utilizes a variety of data sources to secure more than 9,500 repossessions a month. This honor marks ALS Resolvion’s second overall Digital Defense award within the last three years.
“We take our data and network security very seriously and we invest a lot of resources in this area. The award from Digital Defense provides great validation of those efforts,” ALS Resolvion chief technology and compliance officer Keith Yarnell said.
Taking steps involving security likely was a part of ALS Resolvion collecting another award from DRN during the annual North American Repossessors Summit (NARS) held in Irving, Texas.
The award marks the third consecutive year that the forwarding company was honored by DRN for its role in the repossession industry. ALS Resolvion was the 2018 Gold Provider and is excited to be named the 2019 Platinum Provider for achieving the highest number of total repossession assignments and successful repossessions.
“We were excited to award ALS Resolvion with our 2019 Platinum Provider of the Year Award,” said Jeremiah Wheeler, executive vice president and general manager for fintech with DRN, which also is a member of the Auto Intel Council.
“DRN places tremendous value in our relationship with ALS Resolvion. Year after year, they continue to excel and set new standards for excellence. We are pleased to work with a company that is such a leader in the forwarding community,” Wheeler continued.
ALS Resolvion produced more than 92,000 successful repossessions last year. The award was accepted by ALS Resolvion president Jose Mendiola, who said, “We are honored to have received this prestigious award and it’s a testament to all of the hard work our team and network of agents have put in this past year. This is only the beginning for ALS Resolvion.”
Along with handing out five different awards and generating thousands of dollars for an industry-related charity, the American Recovery Association cheered the success of this year’s North American Repossessors Summit (NARS), sponsored by Harding Brooks Insurance.
ARA officials highlighted that the 11th annual event generated “staggering” attendance of more than 600 participants, including recovery and remarketing professionals as well as finance companies.
ARA president Dave Kennedy said that NARS cemented its place as a “must-attend” event for the recovery industry to benefit attendees and exhibitors alike, with sponsorships and exhibitor opportunities selling out months in advance.
“NARS 2019 set the tone for the future. It was amazing — the energy and feeling of unity was felt in every session and networking event,” Kennedy said. “Every year, I am floored by the event’s ability to bring together professionals from all sides of this industry, while also raising thousands to benefit recovery agents in need.”
NARS 2019 kicked off with workshop options and unique networking opportunities for attendees. During NARS’ Locksmithing Workshop, attendees learned a new vertical that could help add to their bottom line. The annual AT&T Stadium Tour led attendees through the facility to a private field-level dining experience, and even a little rain couldn’t keep golfers away from the annual NARS Golf Tournament.
Other networking opportunities at NARS 2019 included the Harding Brooks Insurance sponsored cocktail party and Digital Recognition Network (DRN) sponsored closing party.
Through a compelling line-up of speakers, NARS 2019 equipped attendees with the practical knowledge and inspiration based on the conference theme, “Adapt, Conquer and Overcome.”
Retired U.S. Navy Seal Mike Sarraille inspired the crowd to practice extreme ownership and have moral courage. Scott Jackson shared his story of having it all, losing it all, and how learning to first adapt and conquer helped him eventually overcome obstacles at every turn in his life. Brandon Gray shared his candid financial expertise on exit-planning during his strategic planning session. The NARS 2019 Keynote speaker, best-selling author Bob Burg, brought the house down with his philosophy on how living life the “go giver way” leads to both professional and personal success.
NARS 2019 also introduced the first-ever NARS Industry Awards, which honored exemplary industry professionals.
The inaugural honorees included:
— Agent of the Year: Michael Simpson
— Service Representative of the Year: Jon Jendral
— Humanitarian of the Year: Ray Franklin
— Agency Owner of the Year: Richard Grosvenor
Additionally, the prestigious Art Christensen Award was given to Mike Reiter for his outstanding contributions and service to the recovery industry.
In addition, fund-raising efforts contributed more than $20,000 to the Recovery Agents Benefit Fund (RABF), thanks to DRN, Reiter and silent auction sponsors, which included:
— Anthony Gentile of Dynamic Wrecker Sales
— David Kennedy of First Credit Resources
— Fidel Sanchez of Midwest Keyless
— Emily Massey of SCAR
— Mike Sarraille of Echelon Front
— Steve Simons of Paramount Recovery Service
NARS 2020 will be held next April. More details about the 12th annual event will be announced soon. Visit reposummit.com for more information.
Toyota Financial Services evidently really likes the results the captive receives from Millennium Capital and Recovery Corp., since the auto-finance provider gave another honor to the forwarding company.
TFS recently handed its Recovery Services Excellence Award to Millennium Capital and Recovery as part of Toyota’s ongoing performance award program that is intended to drive performance results and a competitive spirit among the captive’s recovery service vendors.
Millennium Capital and Recovery added that the award recognizes a vendor’s recovery performance results and compliance and includes a “traveling trophy” that resides in the home office of the current champion for the quarter.
“Millennium is proud to be a long-term partner with Toyota. Our focus is always on providing best in class performance, industry-leading compliance, and world class service. Toyota’s standards of excellence have contributed toward our achieving the highest level of standard for both performance and compliance,” Millennium Capital and Recovery president Jayne Bronchetti said.
“We are honored to receive the recognition from Toyota Financial Services,” Bronchetti continued. “This Recovery Services Excellence Award is truly a team effort encompassing all areas of our business and embodying our teams’ commitments to leveraging technology to drive recovery performance, and to delivering excellence in compliance.”
Back in 2017, Millennium Capital and Recovery became the only recovery management and skip-tracing firm ever to receive the Kaizen Award from Toyota Financial Services.
“Millennium is dedicated to providing value enhancement, process improvement, and successful partnership strategies to our customers. It is a privilege to be a partner with such an outstanding organization as Toyota Financial Services,” Millennium’s chief managing officer Jeffrey Marsh said.
Millennium chief operating officer Scott Wilson added, “We are experiencing industry-changing improvements in recovery performance through the use of technology that is turning high volume transactional data into actionable information and business intelligence that drive our recovery decisioning, and it’s paying off for Millennium’s customers by raising the bar on attainable results.”
Vice president of business operations Diana Moeglin also reacted to the honor from TFS.
“We are proud of our team’s ability to deliver consistent and reliable compliance month after month to meet Toyota’s high standards for all providers. Our performance has been made possible by our recently completed technology platform designed to manage both the placement of assignments as well as our post-recovery performance,” Moeglin said.
“We fully expect our performance in these areas to continue to excel as our dedicated staff becomes more knowledgeable in the use of this technology and the related exception reporting,” she went on to say.
For the second time leading into this week’s North American Repossessors Summit (NARS), Recovery Industry Services Co. (RISC) is bolstering its offerings.
Through its relationship with Hudson Cook, RISC announced it has completed a significant update to the Certified Asset Recovery Specialist (CARS) National Certification program. Improvements include detailed information about repossession insurance, relevant case studies and updates to the laws that govern the self-help repossession process.
“The updates include a comprehensive review of repossession laws to ensure recovery agents are getting the most relevant and recent compliance education,” said Hudson Cook partner Eric Johnson, who will continue to oversee annual updates to the CARS and CARS Continuing Education courses.
RISC president and chief operating officer Holly Balogh added, “We are excited to continue to foster our relationship with Hudson Cook to provide the most thorough, up-to-date educational material to repossession agents.
RISC chief executive officer Stamatis Ferarolis emphasized the relationship with Hudson Cook, as well.
“Our partnership with Hudson Cook means agents who invest in the CARS program are receiving the most recent and relevant training for collateral recovery,” Ferarolis said. “Anyone who becomes certified on the CARS program can be confident that the material is widely accepted and sought after by creditors in the repossession industry.”
This announcement arrived on the heels of RISC being set to release an updated version of the Skip-Tracing Certification authored by Alex Price, who is the director of risk solutions at Digital Recognition Network (DRN), and also known as “The Skip Guru.”
To sign up for the CARS program or a new CE course, visit www.riscus.com/Education/. RISC offers a subscription monthly payment option for all education purchases.
For questions about RISC and the CARS program, contact Balogh at [email protected].
