The VPA Voice - VPA Newsletter

The VPA Voice
"Giving a Voice to Industry Members"
February 28, 2014

Mailers! Mailers!! Mailers!!!
SELLER BEWARE: Don't Let This Happen To You!

The Governor's Office of Consumer Protection in Georgia is investigating a member call center on allegedly deceptive mailers. Deceptive mailers have been a challenging problem in the VSC industry, and we want to alert all members and stress the importance of ensuring your mailers are in compliance with state and federal regulations.

In an effort to take proactive steps and help our members more easily abide by these laws and regulations, we set up a brand new page on the VPA website to display examples of deceptive marketing materials we've come across and explain the problems with each. Available to members only, this page will act as a crucial resource to help our members better understand what elements of marketing materials are being called into question to ensure their own materials are in compliance.

Our member call center has graciously provided us with a copy of the mailer in question so that we can provide analysis on what triggered the investigation. The call center is proactively cooperating with Georgia officials to remedy the situation. Please visit the VPA website for more information.


VPA Announces Annual Meeting
Meet Me in St. Louis!

Mark your calendars! The VPA is excited to announce that this year's Annual Meeting will be held May 13-14 in St. Louis. Though we have a new city and date this year, the Annual Meeting remains the premier gathering of organizations involved in the vehicle service contract industry. More details will be announced as the event nears. Stay tuned!

Regulatory Updates

VPA Legislative Monitoring Report & Memo

As an Association dedicated to upholding the highest standards in the vehicle service contract space, we continue to monitor and track proposed and passed bills and regulations that pertain to our industry. Several new bills/regulations were introduced this month and a summary of each is below. To review the complete list of pending bills and regulations as well as a brief description of each, please visit the Members section of the website to review the Memos and Legislative Monitoring Reports for January and February.

Federal Trade Commission Cracking Down on Robo Callers

The FTC is continuing its efforts to pursue illegal robodialers. In a release published earlier this month, the FTC detailed the proceedings in the case it brought against Paul Navestad, who is responsible for millions of illegal robocalls. Navestad was ordered by the court to pay $20 million in civil penalties – the largest civil penalty against a defendant in an FTC case.

State of Nebraska Update

The State of Nebraska introduced a bill that would change provisions relating to cease and desist orders of the Director of Insurance.

State of Virginia – Extended Service Contracts

In Virginia, a bill was proposed that would expand the types of services that may be provided under an extended service contract to include certain types of damage to a motor vehicle, replacement of keys and the installation or application of certain materials. Additionally, the bill authorizes the Board of Agriculture and Consumer Services to designate additional services that may be provided under an extended service contract.

State of Washington Update

In the state of Washington, bills that would address the regulation of service contracts and protection product guarantees were introduced. Specifically, these bills would regulate reimbursement of incidental costs, provided that a protection product does not include fuel additives, oil additives or other chemical products applied to the engine, transmission, or fuel system of a motor vehicle and regulate reimbursement of incidental costs and relates to road hazards and repairs using paintless dent removal.

State of California Update

In California, a bill was introduced that would make technical, non-substantive changes to an existing law that states automobile insurance includes a contract of warranty or guarantee that promises service, maintenance, parts replacement, repair, money or other indemnity in the event of loss or damage to a motor vehicle.

State of Massachusetts Update

In Massachusetts, a bill that amends the definition of consumer was introduced.

Copies of all these regulations and an analysis of their impact on the vehicle service contract industry can be found in the Member's Section of the VPA website.

If you have any questions, please contact Chris Carenza at

Mavaro Solutions' Failure to Renew Missouri License
Results in VPA Suspension

The Missouri Department of Insurance and Financial Institutions is investigating Mavaro Solutions for level 3 violations, with potential fines payable up to $5,000 for each violation. Mavaro failed to renew its Missouri license on January 1, but continued to sell contracts. The investigation was allegedly triggered by a consumer who allegedly reported she failed to receive a timely refund when she attempted to cancel her contract.

After the VPA conducted its own investigation it was determined that Mavaro's activities were not in compliance with the Standards of Conduct. The VPA Board has suspended Mavaro Solutions for 30 days pending further investigation.

WARNING: Provide Timely Cancellations and Refunds

One of the quickest ways to become a target for a state attorney general's office is to fail to provide timely refunds to consumers. Recently we have seen reports from the BBB that companies have allegedly failed to provide customers refunds when the customer decided to cancel.

When consumers aren't able to obtain timely refunds from providers it is a huge issue for everyone in our industry. This is one of the most serious red flags and can draw attention from state attorneys general.

Some business partners have stepped up to creatively handle the cancellation and refund process. We encourage all call centers to work with their administrators to set up protocols and procedures that will allow you to avoid consumer complaints and potential costly lawsuits with state attorneys general.


Member Showcase

This month the VPA would like to recognize Royal Administration Services, Inc. for their commitment to giving back to the community and encouraging their marketing partners to do the same. During this past holiday season, Royal Administration Services, Inc. donated over $50,000 on behalf of owners and business partners from call centers across the country. Charitable organizations who received donations included local St. Louis charities such as the St. Louis Crisis Nursery, as well as national charities such as the Make A Wish Foundation and the Wounded Warrior Project. The VPA is proud to have Royal Administration Services, Inc. as a member.