credit: SeeMonterey.com
Washington, D.C.— CarMax Inc., the largest used-car retailer in the country, will pay nearly $500,000 to settle claims that it unlawfully repossessed vehicles belonging to U.S. servicemembers, as announced by the Justice Department on Thursday.
As part of the settlement, CarMax will provide at least $420,000 in compensation to the military personnel affected, along with a civil penalty of $79,380 to the federal government. Additionally, the company has committed to updating its policies to avoid any future breaches of the Servicemembers Civil Relief Act (SCRA).
The Department claimed that CarMax repossessed vehicles without obtaining court orders and disregarded notifications from owners indicating they were active duty or reservists with impending military obligations. Federal law safeguards servicemembers from repossession without a court order, as long as they have made at least one payment prior to their military service.
“Federal law prohibits businesses from repossessing service members’ vehicles without a court order,” said Assistant Attorney General Harmeet K. Dhillon of the Justice Department’s Civil Rights Division. “The Department of Justice is proud to defend the rights of those who serve in our military.”
The case was handled by the Civil Rights Division’s Housing and Civil Enforcement Section and the U.S. Attorney’s Office for the Eastern District of Virginia. Since 2011, the Justice Department has secured more than $484 million in relief for over 149,000 servicemembers under the SCRA.
Servicemembers or their families who believe their rights under the SCRA have been violated are advised to contact the nearest Armed Forces Legal Assistance Program Office
