American Nationwide Mortgage Company, Inc.; Analysis of Proposed Consent Order to Aid Public Comment, 2592-2594 [E9-840]
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Federal Register / Vol. 74, No. 10 / Thursday, January 15, 2009 / Notices
Date Revoked: October 30, 2008.
Reason: Failed to maintain a valid
bond.
License Number: 020489N.
Name: Sunspeed Transportation Inc.
Address: 11421 E. Carson Street, Ste.
R, Lakewood, CA 90715.
Date Revoked: October 10, 2008.
Reason: Failed to maintain a valid
bond.
License Number: 010664N.
Name: Taby America, Inc.
Address: 1150 Raritan Rd., Ste. 104,
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Date Revoked: November 30, 2008.
Reason: Failed to maintain a valid
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License Number: 014225NF.
Name: Tri-Star Forwarders Inc. dba
Tri-Star Container Line.
Address: 145–54 157th Street,
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Date Revoked: November 7, 2008.
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Name: Trust Express (LAX) Inc.
Address: 8915 S. La Cienega Blvd.,
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Name: USTC America, Inc.
Address: 1250 E. 223rd Street, Ste
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Name: Wellcorp Express, Inc. dba
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Address: 8616 La Tijera Blvd., Ste.
310, Los Angeles, CA 90045.
Date Revoked: November 27, 2008.
Reason: Failed to maintain a valid
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Name: WPC Consolidators, Inc.
Address: 3770 W. Century Blvd,
Inglewood, CA 90303.
Date Revoked: December 19, 2008.
Reason: Failed to maintain a valid
bond.
Sandra L. Kusumoto,
Director, Bureau of Certification and
Licensing.
[FR Doc. E9–774 Filed 1–14–09; 8:45 am]
BILLING CODE 6730–01–P
jlentini on PROD1PC65 with NOTICES
FEDERAL RESERVE SYSTEM
Formations of, Acquisitions by, and
Mergers of Bank Holding Companies
pursuant to the Bank Holding Company
Act of 1956 (12 U.S.C. 1841 et seq.)
(BHC Act), Regulation Y (12 CFR Part
225), and all other applicable statutes
and regulations to become a bank
holding company and/or to acquire the
assets or the ownership of, control of, or
the power to vote shares of a bank or
bank holding company and all of the
banks and nonbanking companies
owned by the bank holding company,
including the companies listed below.
The applications listed below, as well
as other related filings required by the
Board, are available for immediate
inspection at the Federal Reserve Bank
indicated. The applications also will be
available for inspection at the offices of
the Board of Governors. Interested
persons may express their views in
writing on the standards enumerated in
the BHC Act (12 U.S.C. 1842(c)). If the
proposal also involves the acquisition of
a nonbanking company, the review also
includes whether the acquisition of the
nonbanking company complies with the
standards in section 4 of the BHC Act
(12 U.S.C. 1843). Unless otherwise
noted, nonbanking activities will be
conducted throughout the United States.
Additional information on all bank
holding companies may be obtained
from the National Information Center
website at www.ffiec.gov/nic/.
Unless otherwise noted, comments
regarding each of these applications
must be received at the Reserve Bank
indicated or the offices of the Board of
Governors not later than February 9,
2009.
A. Federal Reserve Bank of
Minneapolis (Jacqueline G. King,
Community Affairs Officer) 90
Hennepin Avenue, Minneapolis,
Minnesota 55480–0291:
1. Eastwood Financial Corporation
Employee Profit Sharing and Stock
Ownership Plan, Rochester, Minnesota,
to become a bank holding company by
acquiring additional voting shares, for a
total of 27 percent of, Eastwood
Financial Corporation, Rochester,
Minnesota, and thereby indirectly
acquire voting sharess of Eastwood
Bank, Kasson, Minnesota.
Board of Governors of the Federal Reserve
System, January 12, 2009.
Robert deV. Frierson,
Deputy Secretary of the Board.
[FR Doc. E9–742 Filed 1–14–09; 8:45 am]
BILLING CODE 6210–01–S
The companies listed in this notice
have applied to the Board for approval,
VerDate Nov<24>2008
18:58 Jan 14, 2009
Jkt 217001
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FEDERAL TRADE COMMISSION
[File No. 072 3168]
American Nationwide Mortgage
Company, Inc.; Analysis of Proposed
Consent Order to Aid Public Comment
Federal Trade Commission.
Proposed Consent Agreement.
AGENCY:
ACTION:
SUMMARY: The consent agreement in this
matter settles alleged violations of
federal law prohibiting unfair or
deceptive acts or practices or unfair
methods of competition. The attached
Analysis to Aid Public Comment
describes both the allegations in the
draft complaint and the terms of the
consent order—embodied in the consent
agreement—that would settle these
allegations.
DATES: Comments must be received on
or before February 9, 2009.
ADDRESSES: Interested parties are
invited to submit written comments.
Comments should refer to ‘‘American
Nationwide Mortgage, File No. 072
3168,’’ to facilitate the organization of
comments. A comment filed in paper
form should include this reference both
in the text and on the envelope, and
should be mailed or delivered to the
following address: Federal Trade
Commission/Office of the Secretary,
Room 135-H, 600 Pennsylvania Avenue,
N.W., Washington, D.C. 20580.
Comments containing confidential
material must be filed in paper form,
must be clearly labeled ‘‘Confidential,’’
and must comply with Commission
Rule 4.9(c). 16 CFR 4.9(c) (2005).1 The
FTC is requesting that any comment
filed in paper form be sent by courier or
overnight service, if possible, because
U.S. postal mail in the Washington area
and at the Commission is subject to
delay due to heightened security
precautions. Comments that do not
contain any nonpublic information may
instead be filed in electronic form by
following the instructions on the webbased form at (https://
secure.commentworks.com/ftcAmericanNationwideMortgage). To
ensure that the Commission consider an
electronic comment, you must file it on
that web-based form.
The FTC Act and other laws the
Commission administers permit the
collection of public comments to
1 The comment must be accompanied by an
explicit request for confidential treatment,
including the factual and legal basis for the request,
and must identify the specific portions of the
comment to be withheld from the public record.
The request will be granted or denied by the
Commission’s General Counsel, consistent with
applicable law and the public interest. See
Commission Rule 4.9(c), 16 CFR 4.9(c).
E:\FR\FM\15JAN1.SGM
15JAN1
Federal Register / Vol. 74, No. 10 / Thursday, January 15, 2009 / Notices
consider and use in this proceeding as
appropriate. All timely and responsive
public comments, whether filed in
paper or electronic form, will be
considered by the Commission, and will
be available to the public on the FTC
website, to the extent practicable, at
www.ftc.gov. As a matter of discretion,
the FTC makes every effort to remove
home contact information for
individuals from the public comments it
receives before placing those comments
on the FTC website. More information,
including routine uses permitted by the
Privacy Act, may be found in the FTC’s
privacy policy, at (https://www.ftc.gov/
ftc/privacy.shtm).
FOR FURTHER INFORMATION CONTACT:
Carole Reynolds, Bureau of Consumer
Protection, 600 Pennsylvania Avenue,
NW, Washington, D.C. 20580, (202) 3263230.
SUPPLEMENTARY INFORMATION: Pursuant
to section 6(f) of the Federal Trade
Commission Act, 38 Stat. 721, 15 U.S.C.
46(f), and § 2.34 of the Commission
Rules of Practice, 16 CFR 2.34, notice is
hereby given that the above-captioned
consent agreement containing a consent
order to cease and desist, having been
filed with and accepted, subject to final
approval, by the Commission, has been
placed on the public record for a period
of thirty (30) days. The following
Analysis to Aid Public Comment
describes the terms of the consent
agreement, and the allegations in the
complaint. An electronic copy of the
full text of the consent agreement
package can be obtained from the FTC
Home Page (for January 8, 2009), on the
World Wide Web, at (https://
www.ftc.gov/os/2009/01/index.htm). A
paper copy can be obtained from the
FTC Public Reference Room, Room 130H, 600 Pennsylvania Avenue, NW,
Washington, D.C. 20580, either in
person or by calling (202) 326-2222.
Public comments are invited, and may
be filed with the Commission in either
paper or electronic form. All comments
should be filed as prescribed in the
ADDRESSES section above, and must be
received on or before the date specified
in the DATES section.
jlentini on PROD1PC65 with NOTICES
Analysis of Agreement Containing
Consent Order to Aid Public Comment
The Federal Trade Commission
(‘‘FTC’’) has accepted, subject to final
approval, an agreement containing a
consent order from American
Nationwide Mortgage Company, Inc.
(‘‘respondent’’).
The proposed consent order has been
placed on the public record for thirty
(30) days for the receipt of comments by
interested persons. Comments received
VerDate Nov<24>2008
18:58 Jan 14, 2009
Jkt 217001
during this period will become part of
the public record. After thirty (30) days,
the Commission will again review the
agreement and the comments received,
and will decide whether it should
withdraw from the agreement or make
final the agreement’s proposed order.
The complaint alleges that respondent
engaged in practices that violate Section
5(a) of the Federal Trade Commission
Act, 15 U.S.C. § 45(a), Section 144 of the
Truth in Lending Act (‘‘TILA’’), 15
U.S.C. § 1664, and Section 226.24 of
Regulation Z, 12 C.F.R. § 226.24.
Section 5(a) of the FTC Act prohibits
unfair or deceptive acts or practices.
Respondent violated Section 5(a) of the
FTC Act because it disseminated or has
caused to be disseminated home loan
advertisements which offer a low
monthly payment amount and/or low
rate, but fail to disclose, or fail to
disclose adequately, that this monthly
payment amount and/or low rate: (1)
apply only for a limited period of time,
after which they will increase; (2) do not
include the amount of interest that the
consumer owes each month; and (3) are
less than the monthly payment amount
(including interest) and/or the interest
rate that the consumer owes, with the
difference added to the total amount
due from the consumer or total loan
balance. This information would be
material to consumers shopping for a
mortgage loan and the failure to
disclose, or failure to disclose
adequately, this information is a
deceptive practice. Respondent also
violated Section 5(a) of the FTC Act
because it misrepresented, expressly or
by implication, that its advertised rate
was a fixed rate for the full term of the
loan.
TILA and Regulation Z require that
closed-end credit advertisers who state
a periodic payment amount must also
provide additional information in the
advertisement, including the terms of
repayment; the annual percentage rate
(‘‘APR’’); and if the APR may be
increased after consummation, that fact.
TILA and Regulation Z also require that
if an advertisement states a rate of
finance charge, it must state the rate as
an APR. Currently, Regulation Z also
requires that if the advertisement states
a payment rate, it must include
additional disclosures. Respondent’s
advertisements failed to disclose, or
failed to disclose clearly and
conspicuously, this information
required by TILA and Regulation Z.
Respondent’s failure to disclose this
information undermined consumers’
ability to compare these offers to others
in the marketplace. Through its law
enforcement actions, the Commission
intends to promote compliance with the
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2593
disclosure requirements of TILA and
Regulation Z, and to foster comparison
shopping for mortgage loans.
The proposed consent order contains
provisions designed to prevent
respondent from violating the FTC Act
or failing to make clear and conspicuous
disclosures required by TILA and
Regulation Z, as amended, see 73 Fed.
Reg. 44,522 (July 30, 2008), and as may
be further amended in the future.
Part I of the proposed order prohibits
respondent, in connection with closedend credit, from advertising a monthly
payment amount unless respondent
discloses, clearly and conspicuously
and in close proximity to those
representations, as applicable, that the
advertised monthly payment amount:
(1) applies only for a limited period of
time, after which it will increase; (2)
does not include the amount of interest
that the consumer owes each month;
and (3) is less than the monthly
payment amount (including interest)
that the consumer owes, with the
difference added to the total amount
due from the consumer or total loan
balance.
Part II of the proposed order prohibits
respondent, in connection with closedend credit, from advertising a rate lower
than the rate at which interest is
accruing, regardless of whether the rate
is referred to as an ‘‘effective rate,’’ a
‘‘payment rate,’’ a ‘‘qualifying rate,’’ or
any other term, provided that this
provision does not prohibit
advertisement of the ‘‘annual percentage
rate’’ or ‘‘APR.’’ In light of respondent’s
deceptive use of payment rates in its
advertisements, and the Federal Reserve
Board’s amendments to Regulation Z
banning the use of such rates effective
October 1, 2009, the proposed order
prohibits respondent from advertising
any such rate, to ensure that
respondent’s advertisements do not
deceive consumers. See 73 Fed. Reg. at
44,608.
Part III of the proposed order
prohibits respondent, in connection
with closed-end credit, from
misrepresenting the nature and/or
extent of the variability of any loan rate
or payment amount, including but not
limited to (1) an interest rate or APR; (2)
whether it is fixed rather than adjustable
or adjustable rather than fixed; and (3)
for an interest rate or payment amount,
the duration, or reasonably anticipated
duration, of the fixed or variable interest
rate or payment amount.
Part IV of the proposed order
prohibits respondent, in connection
with closed-end credit, from advertising
the amount of any payment, the number
of payments or the period of repayment,
or the amount of any finance charge,
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15JAN1
2594
Federal Register / Vol. 74, No. 10 / Thursday, January 15, 2009 / Notices
jlentini on PROD1PC65 with NOTICES
without disclosing, clearly and
conspicuously, all of the terms required
by TILA and Regulation Z, including the
terms of repayment; the APR; and if the
APR may be increased after
consummation, that fact.
Part V of the proposed order prohibits
respondent, in connection with closedend credit, from stating a rate of finance
charge without stating the rate as an
APR, as required by TILA and
Regulation Z.
Part VI of the proposed order
prohibits respondent from failing to
comply in any respect with TILA or
Regulation Z.
Part VII of the proposed order
contains a document retention
requirement, the purpose of which is to
ensure compliance with the proposed
order. It requires that respondent
maintain all records that will
demonstrate compliance with the
proposed order.
Part VIII of the proposed order
requires respondent to distribute copies
of the order to various principals,
officers, directors, and managers, and all
current and future employees, agents
and representatives having
responsibilities with respect to the
subject matter of the order.
Part IX of the proposed order requires
respondent to notify the Commission of
any changes in its corporate structure
that might affect compliance with this
order.
Part X of the proposed order requires
respondent to file with the Commission
one or more reports detailing
compliance with the order.
Part XI of the proposed order is a
‘‘sunset’’ provision, dictating the
conditions under which the order will
terminate twenty years from the date it
is issued or twenty years after a
complaint is filed in federal court, by
either the United States or the FTC,
alleging any violations of the order.
The purpose of this analysis is to
facilitate public comment on the
proposed order, and it is not intended
to constitute an official interpretation of
the agreement and proposed order or to
modify in any way their terms.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. E9–840 Filed 1–14–09: 8:45 am]
BILLING CODE 6750–01–S
VerDate Nov<24>2008
23:17 Jan 14, 2009
Jkt 217001
FEDERAL TRADE COMMISSION
[File No. 082 3034]
Michael Gendrolis dba Good Life
Funding.; Analysis of Proposed
Consent Order to Aid Public Comment
Federal Trade Commission.
Proposed Consent Agreement.
AGENCY:
ACTION:
SUMMARY: The consent agreement in this
matter settles alleged violations of
federal law prohibiting unfair or
deceptive acts or practices or unfair
methods of competition. The attached
Analysis to Aid Public Comment
describes both the allegations in the
draft complaint and the terms of the
consent order—embodied in the consent
agreement—that would settle these
allegations.
DATES: Comments must be received on
or before February 9, 2009.
ADDRESSES: Interested parties are
invited to submit written comments.
Comments should refer to ‘‘Good Life
Funding, File No. 082 3034,’’ to
facilitate the organization of comments.
A comment filed in paper form should
include this reference both in the text
and on the envelope, and should be
mailed or delivered to the following
address: Federal Trade Commission/
Office of the Secretary, Room 135-H,
600 Pennsylvania Avenue, N.W.,
Washington, D.C. 20580. Comments
containing confidential material must be
filed in paper form, must be clearly
labeled ‘‘Confidential,’’ and must
comply with Commission Rule 4.9(c).
16 CFR 4.9(c) (2005).1 The FTC is
requesting that any comment filed in
paper form be sent by courier or
overnight service, if possible, because
U.S. postal mail in the Washington area
and at the Commission is subject to
delay due to heightened security
precautions. Comments that do not
contain any nonpublic information may
instead be filed in electronic form by
following the instructions on the webbased form at (https://
secure.commentworks.com/ftcGoodLifeFunding). To ensure that the
Commission consider an electronic
comment, you must file it on that webbased form.
The FTC Act and other laws the
Commission administers permit the
collection of public comments to
1 The comment must be accompanied by an
explicit request for confidential treatment,
including the factual and legal basis for the request,
and must identify the specific portions of the
comment to be withheld from the public record.
The request will be granted or denied by the
Commission’s General Counsel, consistent with
applicable law and the public interest. See
Commission Rule 4.9(c), 16 CFR 4.9(c).
PO 00000
Frm 00087
Fmt 4703
Sfmt 4703
consider and use in this proceeding as
appropriate. All timely and responsive
public comments, whether filed in
paper or electronic form, will be
considered by the Commission, and will
be available to the public on the FTC
website, to the extent practicable, at
www.ftc.gov. As a matter of discretion,
the FTC makes every effort to remove
home contact information for
individuals from the public comments it
receives before placing those comments
on the FTC website. More information,
including routine uses permitted by the
Privacy Act, may be found in the FTC’s
privacy policy, at (https://www.ftc.gov/
ftc/privacy.shtm).
FOR FURTHER INFORMATION CONTACT:
Carole Reynolds, Bureau of Consumer
Protection, 600 Pennsylvania Avenue,
NW, Washington, D.C. 20580, (202) 3263230.
SUPPLEMENTARY INFORMATION: Pursuant
to section 6(f) of the Federal Trade
Commission Act, 38 Stat. 721, 15 U.S.C.
46(f), and § 2.34 of the Commission
Rules of Practice, 16 CFR 2.34, notice is
hereby given that the above-captioned
consent agreement containing a consent
order to cease and desist, having been
filed with and accepted, subject to final
approval, by the Commission, has been
placed on the public record for a period
of thirty (30) days. The following
Analysis to Aid Public Comment
describes the terms of the consent
agreement, and the allegations in the
complaint. An electronic copy of the
full text of the consent agreement
package can be obtained from the FTC
Home Page (for January 8, 2009), on the
World Wide Web, at (https://
www.ftc.gov/os/2009/01/index.htm). A
paper copy can be obtained from the
FTC Public Reference Room, Room 130H, 600 Pennsylvania Avenue, NW,
Washington, D.C. 20580, either in
person or by calling (202) 326-2222.
Public comments are invited, and may
be filed with the Commission in either
paper or electronic form. All comments
should be filed as prescribed in the
ADDRESSES section above, and must be
received on or before the date specified
in the DATES section.
Analysis of Agreement Containing
Consent Order to Aid Public Comment
The Federal Trade Commission
(‘‘FTC’’) has accepted, subject to final
approval, an agreement containing a
consent order from Michael Gendrolis
dba Good Life Funding (‘‘respondent’’).
The proposed consent order has been
placed on the public record for thirty
(30) days for the receipt of comments by
interested persons. Comments received
during this period will become part of
E:\FR\FM\15JAN1.SGM
15JAN1
]]>Agencies
[Federal Register Volume 74, Number 10 (Thursday, January 15, 2009)]
[Notices]
[Pages 2592-2594]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-840]
=======================================================================
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 072 3168]
American Nationwide Mortgage Company, Inc.; Analysis of Proposed
Consent Order to Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed Consent Agreement.
-----------------------------------------------------------------------
SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair or deceptive acts or
practices or unfair methods of competition. The attached Analysis to
Aid Public Comment describes both the allegations in the draft
complaint and the terms of the consent order--embodied in the consent
agreement--that would settle these allegations.
DATES: Comments must be received on or before February 9, 2009.
ADDRESSES: Interested parties are invited to submit written comments.
Comments should refer to ``American Nationwide Mortgage, File No. 072
3168,'' to facilitate the organization of comments. A comment filed in
paper form should include this reference both in the text and on the
envelope, and should be mailed or delivered to the following address:
Federal Trade Commission/Office of the Secretary, Room 135-H, 600
Pennsylvania Avenue, N.W., Washington, D.C. 20580. Comments containing
confidential material must be filed in paper form, must be clearly
labeled ``Confidential,'' and must comply with Commission Rule 4.9(c).
16 CFR 4.9(c) (2005).\1\ The FTC is requesting that any comment filed
in paper form be sent by courier or overnight service, if possible,
because U.S. postal mail in the Washington area and at the Commission
is subject to delay due to heightened security precautions. Comments
that do not contain any nonpublic information may instead be filed in
electronic form by following the instructions on the web-based form at
(https://secure.commentworks.com/ftc-AmericanNationwideMortgage). To
ensure that the Commission consider an electronic comment, you must
file it on that web-based form.
---------------------------------------------------------------------------
\1\ The comment must be accompanied by an explicit request for
confidential treatment, including the factual and legal basis for
the request, and must identify the specific portions of the comment
to be withheld from the public record. The request will be granted
or denied by the Commission's General Counsel, consistent with
applicable law and the public interest. See Commission Rule 4.9(c),
16 CFR 4.9(c).
---------------------------------------------------------------------------
The FTC Act and other laws the Commission administers permit the
collection of public comments to
[[Page 2593]]
consider and use in this proceeding as appropriate. All timely and
responsive public comments, whether filed in paper or electronic form,
will be considered by the Commission, and will be available to the
public on the FTC website, to the extent practicable, at www.ftc.gov.
As a matter of discretion, the FTC makes every effort to remove home
contact information for individuals from the public comments it
receives before placing those comments on the FTC website. More
information, including routine uses permitted by the Privacy Act, may
be found in the FTC's privacy policy, at (https://www.ftc.gov/ftc/
_____________________________________-
privacy.shtm).
FOR FURTHER INFORMATION CONTACT: Carole Reynolds, Bureau of Consumer
Protection, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580, (202)
326-3230.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec. 2.34 of
the Commission Rules of Practice, 16 CFR 2.34, notice is hereby given
that the above-captioned consent agreement containing a consent order
to cease and desist, having been filed with and accepted, subject to
final approval, by the Commission, has been placed on the public record
for a period of thirty (30) days. The following Analysis to Aid Public
Comment describes the terms of the consent agreement, and the
allegations in the complaint. An electronic copy of the full text of
the consent agreement package can be obtained from the FTC Home Page
(for January 8, 2009), on the World Wide Web, at (https://www.ftc.gov/
os/2009/01/index.htm). A paper copy can be obtained from the FTC Public
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW, Washington,
D.C. 20580, either in person or by calling (202) 326-2222.
Public comments are invited, and may be filed with the Commission
in either paper or electronic form. All comments should be filed as
prescribed in the ADDRESSES section above, and must be received on or
before the date specified in the DATES section.
Analysis of Agreement Containing Consent Order to Aid Public Comment
The Federal Trade Commission (``FTC'') has accepted, subject to
final approval, an agreement containing a consent order from American
Nationwide Mortgage Company, Inc. (``respondent'').
The proposed consent order has been placed on the public record for
thirty (30) days for the receipt of comments by interested persons.
Comments received during this period will become part of the public
record. After thirty (30) days, the Commission will again review the
agreement and the comments received, and will decide whether it should
withdraw from the agreement or make final the agreement's proposed
order.
The complaint alleges that respondent engaged in practices that
violate Section 5(a) of the Federal Trade Commission Act, 15 U.S.C.
Sec. 45(a), Section 144 of the Truth in Lending Act (``TILA''), 15
U.S.C. Sec. 1664, and Section 226.24 of Regulation Z, 12 C.F.R. Sec.
226.24.
Section 5(a) of the FTC Act prohibits unfair or deceptive acts or
practices. Respondent violated Section 5(a) of the FTC Act because it
disseminated or has caused to be disseminated home loan advertisements
which offer a low monthly payment amount and/or low rate, but fail to
disclose, or fail to disclose adequately, that this monthly payment
amount and/or low rate: (1) apply only for a limited period of time,
after which they will increase; (2) do not include the amount of
interest that the consumer owes each month; and (3) are less than the
monthly payment amount (including interest) and/or the interest rate
that the consumer owes, with the difference added to the total amount
due from the consumer or total loan balance. This information would be
material to consumers shopping for a mortgage loan and the failure to
disclose, or failure to disclose adequately, this information is a
deceptive practice. Respondent also violated Section 5(a) of the FTC
Act because it misrepresented, expressly or by implication, that its
advertised rate was a fixed rate for the full term of the loan.
TILA and Regulation Z require that closed-end credit advertisers
who state a periodic payment amount must also provide additional
information in the advertisement, including the terms of repayment; the
annual percentage rate (``APR''); and if the APR may be increased after
consummation, that fact. TILA and Regulation Z also require that if an
advertisement states a rate of finance charge, it must state the rate
as an APR. Currently, Regulation Z also requires that if the
advertisement states a payment rate, it must include additional
disclosures. Respondent's advertisements failed to disclose, or failed
to disclose clearly and conspicuously, this information required by
TILA and Regulation Z. Respondent's failure to disclose this
information undermined consumers' ability to compare these offers to
others in the marketplace. Through its law enforcement actions, the
Commission intends to promote compliance with the disclosure
requirements of TILA and Regulation Z, and to foster comparison
shopping for mortgage loans.
The proposed consent order contains provisions designed to prevent
respondent from violating the FTC Act or failing to make clear and
conspicuous disclosures required by TILA and Regulation Z, as amended,
see 73 Fed. Reg. 44,522 (July 30, 2008), and as may be further amended
in the future.
Part I of the proposed order prohibits respondent, in connection
with closed-end credit, from advertising a monthly payment amount
unless respondent discloses, clearly and conspicuously and in close
proximity to those representations, as applicable, that the advertised
monthly payment amount: (1) applies only for a limited period of time,
after which it will increase; (2) does not include the amount of
interest that the consumer owes each month; and (3) is less than the
monthly payment amount (including interest) that the consumer owes,
with the difference added to the total amount due from the consumer or
total loan balance.
Part II of the proposed order prohibits respondent, in connection
with closed-end credit, from advertising a rate lower than the rate at
which interest is accruing, regardless of whether the rate is referred
to as an ``effective rate,'' a ``payment rate,'' a ``qualifying rate,''
or any other term, provided that this provision does not prohibit
advertisement of the ``annual percentage rate'' or ``APR.'' In light of
respondent's deceptive use of payment rates in its advertisements, and
the Federal Reserve Board's amendments to Regulation Z banning the use
of such rates effective October 1, 2009, the proposed order prohibits
respondent from advertising any such rate, to ensure that respondent's
advertisements do not deceive consumers. See 73 Fed. Reg. at 44,608.
Part III of the proposed order prohibits respondent, in connection
with closed-end credit, from misrepresenting the nature and/or extent
of the variability of any loan rate or payment amount, including but
not limited to (1) an interest rate or APR; (2) whether it is fixed
rather than adjustable or adjustable rather than fixed; and (3) for an
interest rate or payment amount, the duration, or reasonably
anticipated duration, of the fixed or variable interest rate or payment
amount.
Part IV of the proposed order prohibits respondent, in connection
with closed-end credit, from advertising the amount of any payment, the
number of payments or the period of repayment, or the amount of any
finance charge,
[[Page 2594]]
without disclosing, clearly and conspicuously, all of the terms
required by TILA and Regulation Z, including the terms of repayment;
the APR; and if the APR may be increased after consummation, that fact.
Part V of the proposed order prohibits respondent, in connection
with closed-end credit, from stating a rate of finance charge without
stating the rate as an APR, as required by TILA and Regulation Z.
Part VI of the proposed order prohibits respondent from failing to
comply in any respect with TILA or Regulation Z.
Part VII of the proposed order contains a document retention
requirement, the purpose of which is to ensure compliance with the
proposed order. It requires that respondent maintain all records that
will demonstrate compliance with the proposed order.
Part VIII of the proposed order requires respondent to distribute
copies of the order to various principals, officers, directors, and
managers, and all current and future employees, agents and
representatives having responsibilities with respect to the subject
matter of the order.
Part IX of the proposed order requires respondent to notify the
Commission of any changes in its corporate structure that might affect
compliance with this order.
Part X of the proposed order requires respondent to file with the
Commission one or more reports detailing compliance with the order.
Part XI of the proposed order is a ``sunset'' provision, dictating
the conditions under which the order will terminate twenty years from
the date it is issued or twenty years after a complaint is filed in
federal court, by either the United States or the FTC, alleging any
violations of the order.
The purpose of this analysis is to facilitate public comment on the
proposed order, and it is not intended to constitute an official
interpretation of the agreement and proposed order or to modify in any
way their terms.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. E9-840 Filed 1-14-09: 8:45 am]
BILLING CODE 6750-01-S
