Monroe'S Automotive Center

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In Tee Matrer or «SONS AUTO CENTER, INC., rraping as MONROE’S AUTOMOTIVE CENTER, ET AL.

CONSENT ORDER IN REGARD TO THE ALLEGED VIOLATIONS OF THE FEDERAL TRADE COMMISSION AND THE TRUTH IN LENDING ACTS Docket C-2445. Complaint, Sept. 11, 1973—Decision, Sept. 11, 1973. Consent order requiring a Washington, D.C., retailer and distributor of used cars, among other things to cease violating the Truth 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: Alan Cohen and Bernard Rowitz. For the respondent: pro se.

ComMPpLAINT Pursuant to the provisions of the Truth in Lending Act and the implementing regulation 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 Sons Auto Center, Inc., a corporation, trading and doing business as Monroe’s Automotive Center, and Monroe Lenoff, individually a OOO ee aa8 416 Complaint and as an officer of said corporation, hereinafter sometimes referred to as respondents, have violated the provisions of said Acts and implementing regulation, 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: Paracgraru 1. Respondent Sons Auto Center, Inc., trading ‘and doing business as Monroe’s Automotive Center, is a corporation organized, existing and doing business under and by virtue of the laws of the District of Columbia, with its principal office and place of business located at 2001 West Virginia Avenue, N.E., Washington, D.C. Respondent Monroe Lenoff is an officer of the corporate respondent. He formulates, directs and controls the policies, acts and practices of the corporation, including the acts and practices hereinafter set forth. His address is the same as that of the corporate respondent Sons Auto Center, Inc. ;

Par. 2. Respondents are now, and for some time last past have been engaged in the offering for sale and retail sale and distribution of used cars to the public.

Par. 8. In the ordinary course and conduct of their business as aforesaid, respondents regularly extend consumer credit, as “consumer credit” is defined in Regulation Z, the implementing regulation of the Truth in Lending Act, duly promulgated by the Board of Governors of the Federal Reserve System.

Par. 4. Subsequent to July 1, 1969, respondents, in the ordinary course of business as aforesaid, and in connection with their credit sales, as “credit sale” is defined in Regulation Z, have caused and are causing customers to execute a binding conditional sales contract. Respondents also provide these customers with a Truth in Lending Disclosure Statement.

By and through the use of the Truth in Lending Disclosure Statement, respondents:

1. Fail, in some instances, to disclose the “annual percentage rate,” in accordance with Section 226.5 of Regulation Z, as required by Section 226.8 (b) (2) of Regulation Z.

Par. 5. In the ordinary course of their business as aforesaid, respondents cause to be published advertisements of their goods and services, as “advertisement” is defined in Regulation Z. These advertisements aid, promote, or assist directly or indirectly extensions of consumer credit in connection with the sale of these goods and services. By and through the use of the advertisements, respondents: Complaint 83 F.T.C.

1. Fail in some instances to disclose the annual percentage rate with an accuracy at least to the nearest quarter of one percent, in accordance with Section 226.5 of Regulation Z, as required by Section 226.10 (d) (1) of Regulation Z. ;

2. Fail to use the term “annual percentage rate” to describe the rate of a finance charge, as required by Section 226.10(d) (1) of Regulation Z.

3. Fail to print the term “annual percentage rate” more conspicuously than other required terminology, as required by Section 226.6 (a) of Regulation Z.

4. Fail to use the term “deferred payment price” to describe the sum of the cash price, all charges which are included in the amount financed but which are not part of the finance charge, and the finance charge, as required by Section 226.10(d) (2) (v) of Regulation Z. Par. 6. Pursuant to Section 103(q) of the Truth 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.

Deoision AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption here- . of, and the respondents having been furnished thereafter with a copy of a draft of complaint which the Washington, D.C. 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 Truth in Lending Act and the implementing regulation promulgated thereunder, and 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 aforesaid draft of complaint, 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;

The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Acts, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed 416 Decision and Order consent agreement and placed such agreement 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, makes the following jurisdictional findings, and enters the following order:

1. Respondent Sons Auto Center, Inc., trading and doing business as Monroe’s Automotive Center, is a corporation organized, existing and doing business under and by virtue of the laws of the District of Columbia, with its principal office and place of business located at 2001 West Virginia Avenue, N.E., Washington, D.C. Respondent Monroe Lenoff is an individual and is a corporate officer of Sons Auto Center, Inc. He directs, formulates, and controls the acts and practices of respondent corporation, including the acts and practices under investigation.

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 respondents Sons Auto Center, Inc., a corporation, trading and doing business as Monroe’s Automotive Center, or under any name or names, its successors and assigns and its officers, and Monroe Lenoff, individually and as an officer of said corporation and respondents’ agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with any extension of consumer credit or advertisement to aid, promote or assist directly or indirectly any extension of consumer credit, as “consumer credit” and “advertisement” 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 seg.), do forthwith cease and desist from: 1. Failing to disclose the “annual percentage rate,” in accordance with Section 226.5 of Regulation Z, as required by Section 226.8 (b) (2) of Regulation Z.

2. Failing in any published advertisement, as “advertisement” is defined in Regulation Z, to disclose the annual percentage rate with an accuracy at least to the nearest quarter of one percent, in accordance with Section 226.5 of Regulation Z, as required by Section 226.10(d) (1) of Regulation Z.

3. Failing in any published advertisement, as “advertisement” is defined in Regulation Z, to use the term “annual percentage Decision and Order - 83 FVT.C.

rate” to describe the rate of a finance charge, as required by Section 226.10(d) (1) of Regulation Z.

4. Failing in any published advertisement, as “advertisement” is defined in Regulation Z, to print the term “annual percentage rate” more conspicuously than other required terminology, as required by Section 226.6 (a) of Regulation Z. 5. Failing in any published advertisement, as “advertisement” is defined in Regulation Z, to use the term “deferred payment price” to describe the sum of the cash price, all charges which are included in the amount financed. but which are not part of the finance charge, and the finance charge, as required by Section 226.10(d) (2) (v) of Regulation Z.

6. Failing in any consumer credit transaction or advertising to make all disclosures determined in accordance with Sections 226.4 and 226.5 of Regulation Z at the time and in the manner, form. and amount required by Sections 226.6, 226.8 and 226.10 of Regulation Z. ;

It is further ordered, That respondents deliver a copy of this order to cease and desist to all present and future personnel of respondents engaged in the consummation of any extension of consumer credit or in any aspect of preparation, creation, or placing of advertising, and that respondents secure a signed statement acknowledging receipt of said order from each such person.

It is further ordered, That the individual respondent named herein promptly notify the Commission of the discontinuance of his present business or employment and of his affiliation with a new business or employment. Such notice shall include respondent’s current business address and a statement as to the nature of the business or employment in which he is engaged as well as a description of his duties and responsibilities.

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. It is further ordered, That the respondents shall, within sixty (60) days after service upon them of this order, file with the Commission a report, in writing, setting forth in detail the manner and form in which they have complied with this order.

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