Agency: Federal Trade Commission (FTC)Washington
Description:
The Federal Trade Commission ("FTC") executed an Agreement with Norm Reeves, Inc ("Norm Reeves"). The FTC conducted an investigation into the activities of Norm Reeves and determined they violated the Federal Trade Commission Act, the Consumer Leasing Act, and the Truth in Lending Act. Under the terms of the Agreement, Norm Reeves is Ordered in all print advertisements, television or video advertisements, radio advertisements, and in all advertisements, to deliver the advertisements in a clear and conspicuous manner sufficient for an ordinary consumer to notice, read, hear, and comprehend it. The Agreement further prohibts Norm Reeves from misrepresenting the cost of leasing a vehicle, including the total amount due at lease inception, the down payment, acquisition fee, capitalized cost reduction, any other amount required to be paid at lease inception, and the amounts of all monthly payments. Norm Reeves is further prohibited from misrepresenting the cost of purchasing a vehicle with financing, including the amount or percentage of the down payment, the number of payments or period of repayment, the amount of any payment, the annual percentage rate or any other finance rate, and the repayment obligation over the full term of the loan, including any balloon payment. The Agreement prohibts Norm Reeves from misrepresenting any material fact about the price, sale, financing, or leasing of any vehicle. Norm Reeves is further Ordered in connection with any advertisement for the purchase or financing of motor vehicles, shall not make any representation regarding an annual percentage rate or other interest rate, unless the representation clearly and conspicuously discloses any material limitation on obtaining the rate, including whether different rates apply based on the amount financed, and if so, the different rates that apply. When leasing a vehicle, Norm Reeves shall not state the amount of any payment or that any or no initial payment is required at lease inception without disclosing clearly and conspicuously the following terms: that the transaction advertised is a lease, the total amount due at lease signing or delivery, whether or not a security deposit is required, the number, amounts, and timing of scheduled payments, and that an extra charge may be imposed at the end of the lease term in a lease in which the liability of the consumer at the end of the lease term is based on the anticipated residual of the vehicle. It is further Ordered that Norm Reeves state the amount or percentage of any down payment, the number of payments or period of repayment, the amount of any payment, or the amount of any finance charge, without disclosing clearly and conspicuously the amount or percentage of the down payment, the terms of repayment, the annual percentage rate. If the annual percentage rate may be increased after consummation of the credit transaction, that fact must also be disclosed, and state a rate of finance charge without stating the rate an an "annual percentage rate" or the abbreviation "APR," using that term.
For five years after the last date of dissemination of this Order, upon request of the FTC, Norm Reeves shall make available any documents necessary to demonstrate full compliance with each provision of this Order. Norm Reeves shall deliver a copy of this Order to all current and future principals, officers, directors, and managers, and to all current and future employees, agents, and representatives having responsibilities with respect to the subject matter of this Order, and shall secure from each such person a signed and dated statement acknowledging receipt of the Order. Norm Reeves shall deliver this Order to current personnel within thirty days after the date of service of this Order, and to future personnel within thirty days after the person assumes such position or responsibilities. It is further Ordered that Norm Reeves notify the FTC at least thirty days prior to any change in the corporation(s) that may affect compliance obligations arising under this Order and within sixty days after the date of service of this Order, shall file with the FTC a true and accurate report, in writing, setting forth in detail the manner and form of its own compliance with this Order.
This Order will terminate on February 20, 2034 , or twenty years from the most recent date that the United States or the FTC files a complaint in federal court alleging any violation of the Order.
Date of Action: 2/20/2014