Blog: Republican senators oppose proposed FTC auto financing guidance – Financial Regulation News – Financial Regulation News

U.S. Sens. Cynthia Lummis (R-WY), John Thune (R-SD), Todd Young (R-IN), Shelley Moore Capito (R-WV), Mike Lee (R-UT), and Dan Sullivan (R-AK) forwarded correspondence Tuesday to Federal Trade Commission (FTC) Chair Lina Khan, expressing their opposition to the agency’s proposed rule regarding the dealer financing model for motor vehicles.

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The proposed rule would create new reporting requirements on auto companies providing direct financing to customers and assert the FTC did not provide advance notice of the proposed rulemaking.

“We are writing in opposition to the Federal Trade Commission’s (FTC) ‘Motor Vehicle Dealers Trade Regulation Rule,’ published in the Federal Register on July 13, 2022,” the legislators wrote. “This proposed rule would fundamentally change the way that vehicles are retailed in America. If implemented, this proposal would confuse customers, lengthen the transaction time to purchase a vehicle, limit consumer choice, increase paperwork and mandate burdensome new record-keeping requirements on small businesses. More troubling, the FTC appears not to have done any consumer testing to ascertain whether its new regulatory regime would work in practice.”

In the letter, the legislators request the FTC address a series of questions – including inquiries about whether the FTC consulted with the Federal Reserve Board regarding the proposed rule; what consultations the FTC had with the Consumer Financial Protection Bureau before issuing this proposal; and why did the FTC choose not to issue an Advanced Notice of Proposed Rulemaking to gather basic data before issuing a Notice of Proposed Rulemaking.

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