Hyundai and Kia’s American financing arm, Hyundai Capital America, is facing a lawsuit from the U.S. government. The complaint, filed in federal court in Los Angeles, accuses the company of repossessing vehicles leased by military service members without obtaining court permission, as required by the Service members Civil Relief Act.
Between 2015 and 2023, Hyundai Capital America allegedly repossessed 26 vehicles whose owners had already started paying off their loans before going on active duty. The Department of Justice contends that members of the Armed Forces should not suffer financial hardship due to their service.
The lawsuit highlights the case of Navy Airman Jessica Johnson, whose three-year-old Hyundai Elantra was repossessed and sold in 2017, despite her being on active duty but not deployed. At the time of repossession, Johnson still owed $13,796 on the car. In 2020, the financing arm acknowledged that it should not have seized her vehicle.
As of now, Hyundai Capital America and the automakers have not provided any comments regarding the lawsuit. The filed complaint seeks a halt to improper repossessions and a declaration that this is a matter of significant public importance.
It is worth noting that the U.S. government has previously settled claims against several financing companies for similar violations of the service members law. General Motors, Nissan, and Wells Fargo finance arms have all faced legal action from the Department of Justice.
These cases emphasize the importance of protecting military service members from unfair financial practices. The Service members Civil Relief Act is specifically designed to safeguard the financial well-being of those who serve our country. Repossessing their vehicles without court permission not only causes undue financial hardship but also adds stress and uncertainty to an already challenging situation.
Furthermore, this lawsuit raises concerns about the need for greater industry compliance with the law. It is disconcerting that multiple financing companies have been found guilty of violating the Service members Civil Relief Act. This indicates a systemic issue that must be addressed to ensure the fair treatment of military service members.
In conclusion, the U.S. government’s lawsuit against Hyundai and Kia’s American financing arm sheds light on the alleged improper repossession of vehicles belonging to military service members. This case serves as a reminder of the importance of respecting the rights and financial well-being of those who serve our country. The outcome of this lawsuit will undoubtedly have significant implications, not only for the companies involved but also for the wider automotive financing industry.