Modern Mobile Homes, Inc

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IN THE MATTER OF MODERN MOBILE. HOMES, INC., ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF | THE TRUTH IN LENDING AND FEDERAL TRADE COMMISSION ACTS Docket C-2434. Complaint, Aug. 30, 1973—Decision, Aug. 30, 1973. 344 Complaint Consent order requiring a Kansas City, Missouri, mobile home dealer, among other things to cease violating the Trust in Lending Act by failing to disclose to consumers, in connection with the extension of consumer credit, such information as required by Regulation Z of the said Act.

Appearances For the Commission: J. T. Hankins.

For the respondents: pro se.

COMPLAINT Pursuant to the provisions of the Truth in Lending Act and the implementing regulations promulgated thereunder and the Federal Trade Commission Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Modern Mobile Homes, Inc., a corporation, and Alfred V. Paussa and Richard D. Miller, individually and as officers of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and implementing regulations, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows: PARAGRAPH 1. Respondent Modern Mobile Homes, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Missouri, with its principal office and place of business located at 5729 Northeast Compton, Kansas City, Missouri.

Respondents Alfred V. Paussa and Richard D. Miller are officers of the corporate respondent. Together, they formulate, direct, and control the policies, acts, and practices of the corporate respondent. Their address is the same as that of the corporate respondent.

Par. 2. Respondents are now, and for some time last past have been, engaged in the advertising, offering for sale, and sale of mobile homes to the public.

Par. 3. In the course and conduct of their business as aforesaid, respondents have caused, and are now causing, advertisements, as “advertisement” is defined.in Section 226.2(b) of Regulation Z, to be placed in various media for the purpose of aiding, promoting, or assisting, directly or indirectly, the credit sales, as ‘“‘credit sale” is defined in Section 226.2(n) of Regulation Z, of respondents’ said mobile homes.

Complaint 83 F.T.C.

Par. 4. Subsequent to July 1, 1969, certain of the advertisements referred to in Paragraph Three above have stated the amount of the downpayment required or that no downpayment is required, or the amount of installment payments, without also stating, as required by Section 226.10(d) (2) of Regulation Z, in terminology prescribed under Section 226.8 of Regulation Z, and in the manner and form prescribed under Section 226.6 (a) of Regulation Z, all of the following: 1. The cash price;

2. The amount of the downpayment required or that no downpayment is required, as applicable;

3. The number, amount, and due dates or period of payments scheduled to repay the indebtedness ;

4, The amount of the finance charge expressed as an annual percentage rate; and 5. The deferred payment price.

Par. 5. Pursuant to Section 103(q) of the Trust in Lending Act, respondents’ aforesaid failures to comply with the provisions of Regulation Z constitute violations of that Act, and pursuant to Section 108 thereof, respondents have thereby violated the Federal Trade Commission Act.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption hereof, and the respondents having been furnished thereafter with a copy of a draft of complaint which the Kansas City Regional Office proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondents. with violation of the Federal Trade Commission Act; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondents of all the jurisdictional facts set forth in the complaint to issue herein, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as alleged in such complaint, and waivers. and other provisions as required by the Commission’s rules; and The Commission having considered the agreement and having accepted same, and the agreement containing consent order 344 Decision and Order having thereupon been placed on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in Section 2.34(b) of its rules, the Commission hereby issues its complaint in the form contemplated by said agreement, makes the following jurisdictional findings, and enters the following order:

1. Respondent Modern Mobile Homes, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Missouri, with its principal office and place of business located at 5729 Northeast Compton, Kansas City, Missouri.

Respondents Alfred V. Paussa and Richard D. Miller are officers of corporate respondent. They formulate, direct, and control the policies, acts, and practices of the corporate respondent, including the acts and practices hereinafter set forth. Their address is the same as that of the corporate respondent. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents and the proceeding is in the public interest. ORDER It is ordered, That respondent Modern Mobile Homes, Inc., a corporation, and its officers, and Alfred V. Paussa and Richard D. Miller, individually and as officers of said corporation, trading under said corporate name or under any trade name or names, their successors and assigns, and respondents’ agents, representatives, and employees, directly or through any corporation, subsidiary, division, or other device, in connection with the arrangement, extension, or advertisement of consumer credit in connection with the sale of mobile homes or other products or services, as “advertisement” and ‘consumer credit” are defined in Regulation Z (12 C.F.R. § 226) of the Truth in Lending Act (Pub.L. 90-321, 15 U.S.C. 1601 et seqg.), do forthwith cease and desist from:

1. Representing, directly or by implication, in any advertisement, as “advertisement” is defined in Regulation Z, the amount of the downpayment required or that no downpayment is required, the amount of any installment payment, the number of installments or the period of repayment, or that there is no charge for credit, unless all of the following items are stated in terminology prescribed under Section 226.8 of Regulation Z:

Decision and Order 83 F.T.C.

(a) The cash price;

(b) The amount of the downpayment required or that no downpayment is required, as applicable; (c) The number, amount, and due dates or period of payments scheduled to repay the indebtedness if the credit is extended;

(d) The amount of the finance charge expressed as an annual percentage rate; and (e) The deferred payment price.

2. Failing, in any consumer credit transaction or advertisement, to make all the disclosures, determined in accordance with Sections 226.4 and 226.5 of Regulation Z, in the manner, form, and amount required by Sections 226.6, 226.7, 226.8, 226.9, and 226.10 of Regulation Z. 8. Failing to deliver a copy of this order to cease and _ desist to all present. and future personnel of respondents engaged in any aspect of preparation, creation, and placing of advertising, all persons engaged in reviewing the legal sufficiency of advertising, and all present and future agencies engaged in preparation, creation, and placing of advertising on behalf of respondents, and failing to secure from each such person or agency a signed statement acknowledging receipt of said order.

It is further ordered, That respondents notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent such as dissolution, assignment, or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries, or any other change in the corporation which may affect compliance obligations arising out of the order.

Tt is further ordered, That the individual respondents named herein promptly notify the Commission of the discontinuance of their present business or employment and of their affiliation with a new business or employment. Such notice shall include respondents’ current business address and a statement as to the nature of the business or employment in which they are engaged as well as a description of their duties and responsibilities. It is further ordered, That respondents shall, within sixty (60) days after service upon them of this order, file, individually, with the Commission, a report in writing, setting forth in detail the manner and form in which each of them has complied with this order.

Complaint