Article

Regulation M

November 2010, Auto Dealer Today - WebXclusive

by Jennifer Murphy Bloodworth - Also by this author

Regulation M was “issued by the Board of Governors of the Federal Reserve System to implement the consumer leasing provisions of the Truth in Lending Act.” The three purposes of Regulation M are:

“(1) To ensure that lessees of personal property receive meaningful disclosures that enable them to compare lease terms with other leases and, where appropriate, with credit transactions;
(2)  To limit the amount of balloon payments in consumer lease transactions; and
(3)  To provide for the accurate disclosure of lease terms in advertising.” [1]

Penalties for non-compliance: As a part of the Truth in Lending Act, criminal liability for willful and knowing violation is a maximum fine of $5,000 and/or maximum imprisonment of one year. [2]

Helpful link(s)/Source(s):
1. http://www.fdic.gov/regulations/laws/rules/6500-2000.html#fdic65002132
2. http://www.fdic.gov/regulations/laws/rules/6500-200.html
http://ftc.gov/bcp/edu/pubs/business/adv/bus18.shtm

Please note: This is not legal advice and dealers should always seek the assistance of qualified legal counsel.


From "19 Laws, Rules and Regulations That Can Cost You More Than Money" in the September 2010 issue of Auto Dealer Monthly.

Your Comment

Please note that comments may be moderated. 
Leave this field empty:
Your Name:  
Your Email:  

Blog

On-the-Point

Jim Ziegler
All Things Must Pass

By Jim Ziegler
Ziegler mourns the loss of Gregg Allman as Ford and Hyundai shake up their leadership teams and Carvana struggles to stay afloat.

Join the Battle of Jericho

By Jim Ziegler
Ziegler has harsh words for the so-called geniuses behind escalating factory incentives, political support for autonomous vehicles, AutoNation's 'millennial-friendly' pay plan, and the Carvana IPO.

Don't Run, We Are Your Friends!

By Jim Ziegler

The Future Ain't What It's Cracked Up to Be

By Jim Ziegler

Opening Observations

Over the Curb