The Department of Justice mandated that the City of El Paso, Texas, and two private towing companies pay thousands in fines for selling vehicles owned by members of the Armed Forces. Rod Robertson Enterprises and United Road Towing failed to honor the Servicemembers Civil Relief Act (SCRA), which mandates that you cannot repossess and sell the vehicle of someone with active duty military status without a court order.
176 vehicles owned by service members deployed in action were repossessed illegally, so the Justice Department launched an investigation that led to fines. El Paso towed the cars through its contractors, United Road Towing and Rod Robertson Enterprises, so the city will also be fined.
As part of the settlement released last August 2024, El Paso City will be required to pay $20,000 in fines. Moreover, the city must develop policies that ensure all its contractors tasked with towing and impounding cars adhere to SCRA stipulations.
Rod Robertson Enterprises, which acted as the city’s contractor between 2015 and 2019, will be required to pay $140,000 in compensation to the affected soldiers and a $20,000 civil penalty.
United Road Towing has been the city’s contractor since 2019 and must pay $57,395 in compensation to the affected soldiers and an additional $24,980 in civil penalties. Because the company has an existing contract with El Paso City, it must provide SCRA training to its employees.
Moreover, the company will be required to confirm a person’s active duty status before proceeding with any car repossession. An SCRA waiver will also be necessary for the company to proceed with impounding a person’s car.
It should be highlighted that this investigation was launched after Lieutenant Colonel Lisa Dechent’s car was sold for $6,200. When it was sold, she still owed $13,000 in car loan payments. Because of the SCRA, she’ll be paid for the trouble caused. Other service members affected by the city’s impound will also be compensated.
The DOJ’s assistant attorney general, Kristen Clarke, remarked that service members shouldn’t have to worry about their cars getting auctioned off while defending the country’s freedoms and rights. The substantial penalties incurred by all parties should send a robust message to other cities by highlighting the importance of adhering to SCRA laws and protections.
The SCRA stipulates that it is illegal to repossess and sell a service member’s personal belongings, including cars, while they render active duty service. Repossession can only proceed with a court order or if the service member signs an SCRA waiver. While violating the SCRA may not incur jail time, violators will be forced to pay thousands in fines, which may affect their business operations in the long run.
Cases like this are a testament to how vital it is for companies to confirm a person’s active duty status before repossessing their vehicle. Unfortunately, this process may be time-consuming if they ask each customer if they’re part of the Armed Forces.
SCRACVS can help companies abide by the SCRA and save money by determining a person’s active duty status as quickly as one day. Open an account today to avoid getting into similar situations in the future.