Attorney General Long Signs Settlement Agreement with MetaBank; Dan Nelson Automotive Consumers to Receive Better Loan Terms
PIERRE, S.D. – Attorney General Larry Long and MetaBank announced today that they have reached an agreement that will help resolve outstanding consumer complaints filed against Dan Nelson Automotive Group and Nelson’s in-house financing company, Car Now Acceptance Corporation (CNAC).
"This agreement was the result of a joint effort between MetaBank and the Attorney General’s Office," said Long. "We are encouraged by MetaBank’s cooperation and we hope that we can reach the same type of agreement with the other lenders with whom we are working."
MetaBank has agreed to:
- Give CNAC consumers a $500 limited warranty credit against future payments owed under each active retail installment contract.
- Make active retail installment contracts current, even if the consumer has not remained current on payments, and waive late fees or interest.
- Reduce the principal balance by the amount of $500 at the end of the consumer’s loan. When the principal balance reaches $500, MetaBank will issue a $500 credit, release the lien, and give the customer a free and clear title to the vehicle.
- Not pursue collection of millions of dollars in charged-off deficiency balances on consumer contracts, which otherwise would have been sold to debt collectors.
Long said that the agreement should result in savings totaling in excess of one million dollars for the 433 South Dakotans who have active Dan Nelson loans and the 848 South Dakotans who have charged-off deficiency balances.
Affected consumers will not need to do anything to participate. The terms of the loan will be automatically changed pursuant to the terms of the agreement. The agreement between MetaBank and Long’s Office will be presented to the Federal Bankruptcy Court in Sioux Falls for approval. If the agreement is approved, affected consumers will receive a letter with more information about the agreement, most likely in the next several weeks. In addition, the agreement does not take away any private legal rights or remedies of the consumers.
Long’s Consumer Protection Division is investigating complaints from consumers alleging that the Dan Nelson dealerships in Sioux Falls and Rapid City engaged in deceptive trade practices. MetaBank is not accused of wrongdoing in those complaints, but reached the agreement with Long to provide relief to some Dan Nelson customers.
Long’s Office is continuing to work with the Iowa Attorney General’s Office on remaining Dan Nelson issues. Iowa Attorney General Tom Miller sued the Dan Nelson dealerships in January. Miller recently reached a similar agreement with MetaBank.
Long notes that the agreement with MetaBank affects approximately one-half of the total number of all Dan Nelson customers in South Dakota. Long and Miller are working with other financial institutions to obtain similar relief for the remaining Dan Nelson customers.
Consumers with questions about the agreement with MetaBank may call the Consumer Protection Division at 1-800-300-1986 or send email to consumerhelp@state.sd.us.
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