2016: Schweikert Voted Against The CFPB's Guidance On Indirect Auto Lending. In July 2016, Schweikert voted for an amendment that would have, according to Congressional Quarterly, "prohibit[ed] the Consumer Financial Protection Bureau from using funds to enforce or administer guidance pertaining to indirect auto lending." The underlying legislation was an FY 2017 financial services appropriations bill. The vote was on the amendment. The House adopted the amendment by a vote of 260 to 162. The House later passed the underlying bill, but the Senate took no substantive action on the legislation. [House Vote 383, 7/7/16; Congressional Quarterly, 7/7/16; Congressional Actions, H. Amdt. 1251; Congressional Actions, H.R. 5485]
Indirect Auto Lending Refers To The Policy Where Auto Dealers Set Up A Loan For The Consumer Rather Than The Consumer Get The Loan From The Bank; The Auto Dealer Can Charge A Higher Interest Rate, Which The Bank And The Dealer Often Share In The Profits. According to Congressional Quarterly, "When purchasing a car, many consumers get the loan through the auto dealership rather than directly from their own financial institutions; this is called 'indirect auto lending.' The auto dealer often provides a bank with information about a consumer, and the bank provides the dealer with an interest rate it will accept for that consumer. The bank, however, allows the auto dealer to charge the consumer a higher interest rate; this increase is called the 'dealer markup,' and the bank and the dealer share the profit." [Congressional Quarterly, 11/13/15]
Legislation Required That The CFPB Conduct A Study On The Costs Of On Veteran-Owned Business. According to Congressional; Quarterly, "As amended, the bill would ensure that the CFPB is required to conduct a study on the costs and impacts of guidance on veteran-owned businesses, rural customers, and rural small businesses in addition to studying the costs and impacts on women-owned, minority-owned, and small businesses." [Congressional Quarterly, 11/18/15]
The CFBP Issued Guidance That Stated That It Would Hold Accountable Indirect Auto Lenders Financially Responsible For Rate Markups On The Basis Of Race, Color, Religion, National Origin, Marital Status And Age; Disparate Impact Was Used As A Justification. According to Congressional Quarterly, "The Dodd-Frank Act (PL 111-203) that created the Consumer Financial Protection Bureau (CFPB) explicitly exempts car dealerships from regulation by that agency. However, the bureau does have the ability to address consumer issues under the Equal Credit Opportunity Act, which makes it illegal to discriminate in a credit transaction on the basis of race, color, religion, national origin, sex, marital status and age. Under that authority, the CFPB in March 2013 issued guidance on fair lending practices for indirect auto lenders, saying that disparate impact discrimination was evident and that it would hold indirect auto lenders accountable for illegal, discriminatory markups by the auto dealers. The bureau suggested that indirect lenders impose controls on dealer markups, monitor markup policy and eliminate dealer discretion to mark up interest rates --- and instead employ a different reward mechanism, such as a flat fee per transaction." [Congressional Quarterly, 11/13/15]
Disparate Impact Is The Notion That Discrimination Can Occur Without Intent. According to NPR, "The 5-4 ruling endorses the notion of citing disparate impact in housing cases, meaning that statistics and other evidence can be used to show decisions and practices have discriminatory effects --- without proving that they're the result of discriminatory intentions." [NPR, 6/26/15]
2015: Schweikert Voted To Nullify The Consumer Financial Protection Bureau's March 2013 Guidance On Indirect Auto Lending. In November 2015, Schweikert voted for a bill that would have nullified the CFPB's guidance on indirect auto loans. According to Congressional Quarterly, the legislation would have "nullif[ied] the Consumer Financial Protection Bureau's (CFPB) guidance on indirect auto lending published on March 21, 2013. The bill would require the CFPB to provide for a public notice and comment period, make available to the public all data and analysis used in preparing the guidance, and consult with the boards of the Federal Reserve System, the Federal Trade Commission, and the Justice Department when proposing and issuing guidance on indirect auto financing. [...] Further, the bill, as amended, would [have] clarify[ied] that nothing in this bill shall be construed to apply to guidance issued by the Consumer Financial Protection Bureau that is not primarily related to indirect auto financing." The vote was on passage. The House passed the bill by a vote of 332 to 96. The Senate took no substantive action on the bill. [House Vote 637, 11/18/15; Congressional Quarterly, 11/18/15; Congressional Actions, H.R. 1737]
Indirect Auto Lending Refers To The Policy Where Auto Dealers Set Up A Loan For The Consumer Rather Than The Consumer Get The Loan From The Bank; The Auto Dealer Can Charge A Higher Interest Rate, Which The Bank And The Dealer Often Share In The Profits. According to Congressional Quarterly, "When purchasing a car, many consumers get the loan through the auto dealership rather than directly from their own financial institutions; this is called 'indirect auto lending.' The auto dealer often provides a bank with information about a consumer, and the bank provides the dealer with an interest rate it will accept for that consumer. The bank, however, allows the auto dealer to charge the consumer a higher interest rate; this increase is called the 'dealer markup,' and the bank and the dealer share the profit." [Congressional Quarterly, 11/13/15]
Legislation Required That The CFPB Conduct A Study On The Costs Of On Veteran-Owned Business. According to Congressional; Quarterly, "As amended, the bill would ensure that the CFPB is required to conduct a study on the costs and impacts of guidance on veteran-owned businesses, rural customers, and rural small businesses in addition to studying the costs and impacts on women-owned, minority-owned, and small businesses." [Congressional Quarterly, 11/18/15]
The CFBP Issued Guidance That Stated That It Would Hold Accountable Indirect Auto Lenders Financially Responsible For Rate Markups On The Basis Of Race, Color, Religion, National Origin, Marital Status And Age; Disparate Impact Was Used As A Justification. According to Congressional Quarterly, "The Dodd-Frank Act (PL 111-203) that created the Consumer Financial Protection Bureau (CFPB) explicitly exempts car dealerships from regulation by that agency. However, the bureau does have the ability to address consumer issues under the Equal Credit Opportunity Act, which makes it illegal to discriminate in a credit transaction on the basis of race, color, religion, national origin, sex, marital status and age. Under that authority, the CFPB in March 2013 issued guidance on fair lending practices for indirect auto lenders, saying that disparate impact discrimination was evident and that it would hold indirect auto lenders accountable for illegal, discriminatory markups by the auto dealers. The bureau suggested that indirect lenders impose controls on dealer markups, monitor markup policy and eliminate dealer discretion to mark up interest rates --- and instead employ a different reward mechanism, such as a flat fee per transaction." [Congressional Quarterly, 11/13/15]
Disparate Impact Is The Notion That Discrimination Can Occur Without Intent. According to NPR, "The 5-4 ruling endorses the notion of citing disparate impact in housing cases, meaning that statistics and other evidence can be used to show decisions and practices have discriminatory effects --- without proving that they're the result of discriminatory intentions." [NPR, 6/26/15]