The AFM imposes an administrative fine on GMAC for its consumer loans acceptance policy

Pursuant to article 1:98 of the Financial Supervision Act, the AFM announced that the decision of 30 October 2009 to impose a penalty on GMAC Nederland N.V. has become legally irreversible. Now that it is no longer possible to object or appeal against the decision, the penalty has become final.

On 30 October 2009, the Netherlands Authority for the Financial Markets (AFM) imposed an administrative fine of € 24,000 on GMAC Nederland N.V. of Zaltbommel. The administrative fine was imposed, because GMAC, in the period of 1 July 2008 to 26 February 2009, applied assessment criteria with respect to applications for consumer loans that focused insufficiently on the prevention of excessive loans.

In the opinion of the AFM, GMAC has violated Article 115(1) of the Decree on Conduct of Business Supervision of Financial Undertakings under the Wft (Bgfo). This Article obliges credit providers to lay down criteria that are at the basis of the assessment of a consumer's loan application in order to prevent the provision of excessive loans, and to apply those criteria in the assessment of a loan application. A credit provider's acceptance policy should focus on the prevention of the provision of excessive loans to consumers.

The AFM considers, with respect to applications for consumer loans, the code of conduct of the VFN as a minimum implementation of the open standards to prevent excessive loans. The VFN basic standards were tightened effective as of 1 July 2008. It was also determined, effective as 1 October 2008, that the VFN standards have to be income-dependent.

GMAC failed to adjust its acceptance criteria to above in time. Its failure to implement the basic (increased) standard, effective as of 1 July 2008, and the income-dependent standard, effective as of 1 October, in its acceptance policy means that GMAC did not apply similar standards, which offer at least the same level of protections as the standards referred to in the VFN code of conduct.

Interested parties can submit the AFM's decision to the competent court for review. If you have any questions or comments you can contact the Financial Markets Information Line on: 0900-5400 540 (5 eurocents per minute).

The AFM promotes fairness and transparency within financial markets. We are the independent supervisory authority for the savings, lending, investment and insurance markets. The AFM promotes the conscientious provision of financial services to consumers and supervises the honest and efficient operation of the capital markets. Our aim is to improve consumers’ and the business sector’s confidence in the financial markets, both in the Netherlands and abroad. In performing this task the AFM contributes to the prosperity and economic reputation of the Netherlands.

The AFM is committed to promoting fair and transparent financial markets.

As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.

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