Bankruptcy

The CFPA Auto-Dealer Exemption

By Adam Levitin

The CFPA/B proposal that the House conferees have presented to the conference committee for the financial reform bill includes an exemption for auto-dealers (see the bottom of p. 13).  It's frankly an exemption that is impossible to justify except as special interest pleading.  They House proposal would exempt used-car salesmen for goodness sakes!  (There's also a less troubling pawn-shop carve-out).  

Today the Federal Reserve's Consumer Advisory Council (CAC) has submitted a letter of opposition to the auto-dealer carve-out to Chairmen Frank and Dodd.  This letter is an unprecedented move for the CAC, which is a non-partisan, expert body that does not usually weigh in on legislation.  I think it shows that there is absolutely no policy justification for the auto dealer carve-out.  

Full post as published by Credit Slips on June 21, 2010 (boomark / email).