HARRISBURG, Pa., April 1, 2016 /PRNewswire-USNewswire/ -- Secretary of Banking and Securities Robin L. Wiessmann and Secretary of Transportation Leslie S. Richards praised a Commonwealth Court decision that will release hundreds of liens on autos of Pennsylvania drivers and return the titles to their owners.
In the case, Commonwealth of Pennsylvania, Department of Banking and Securities v. Autoloans LLC, Loan Servicing Solutions Management LLC, William McKibbin III, Mark Weiner, and Kelly Bonner, the court declared that all motor vehicle liens recorded in favor of the respondents are null and void. Additionally, the court ordered the Department of Transportation (PennDOT) to remove the liens from affected vehicle records, which were used as collateral for auto title loans. PennDOT, whose system had properly recorded the liens in the normal course of business, filed a limited intervention in the case to assist with the removal of the liens. PennDOT had no legal means or authority to release the liens without the court order.
Last June, the Department of Banking and Securities issued an order against the respondents for making unlawful auto title loans to Pennsylvania consumers. These loans used car titles as collateral, with very high and illegal interest rates. In January of this year, Commonwealth Court issued an order that required the respondents to stop making loans to Pennsylvania residents; stop collecting any payments of principal or interest on any existing loan from any Pennsylvania resident; stop repossessing cars from Pennsylvania residents; release all liens on file at the Department of Transportation; and return all titles to Pennsylvania residents.
"I am pleased by the Commonwealth Court's decision, which helps rectify a bad situation in which these Pennsylvanians should never have been placed," said Wiessmann. "The court's decision affirms that unlicensed businesses who might ignore our laws and take advantage of our citizens should stay out of Pennsylvania."
"PennDOT is actively releasing these liens, and affected customers will be receiving their titles as these liens are released," said Richards.
Governor Wolf's Consumer Financial Protection Initiative, announced last November, focuses on creating more awareness among consumers of the risks associated with "easy money" loans, which include auto title loans. The Department of Banking and Securities and Department of Transportation have been working on a pilot program to alert drivers of these risks with information included in registration renewal mailings.
Consumers can learn more about the risks of "easy money" loans here: http://www.dobs.pa.gov/Consumers/Investor%20Ed/Pages/Easy-Money.aspx
Members of the public can contact the Department of Banking and Securities consumer hotline (1-800-PA-BANKS) to file a complaint or ask questions about financial products, transactions, or companies.
Ed Novak (Banking and Securities) 717-783-4721
Alexis Campbell (PennDOT) 717-787-0485
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SOURCE Pennsylvania Department of Banking and Securities; Pennsylvania Department of Transportation