Consumer complaint received 2024-11-17 00:00:00
Product: Vehicle loan or lease — Loan
Issue: Getting a loan or lease — Credit denial
Company: ALLY FINANCIAL INC.
State: FL

Complaint narrative:
I am filing this complaint against Ally Financial for unlawful practices, including the improper denial of credit extension, refusal to recognize my Durable Power of Attorney ( DPOA ), and failure to adhere to federal lending laws. As the authorized agent under DPOA for my principal, XXXX XXXX, I am exercising my legal rights to demand compliance and the recognition of the principals interests.

1. Promissory Note as Collateral Security ( Violation of Federal Reserve Act and UCC ) Upon submitting the credit application, the promissory note provided by my principal was used as collateral security. According to Grimbles v. White, the promissory note fulfills the entire funding requirement for the loan. The Federal Reserve Act, specifically Section 16, allows financial institutions like Ally Financial to use consumer applications as collateral to secure funds from the Federal Reserve.

UCC 3-104 : Recognizes a promissory note as a negotiable instrument that serves as collateral security in financial transactions.

Grimbles v. White : Confirms that a promissory note fully satisfies the loan funding requirements. Any further demands for payment or additional collateral are fraudulent.

Federal Reserve Act, Section 16 : Authorizes banks to obtain Federal Reserve Notes using promissory notes as collateral.

Issue : Ally Financial has not acknowledged this process and is unlawfully imposing additional requirements, violating established case law and federal statutes.

2. Right to Claim Interests, Proceeds, Insurance, Titles, and Equity As the authorized agent, I am entitled to claim all interests, proceeds, insurance, titles, and equity due to the principal, based on my legal capacity under the DPOA.

UCC 9-102 ( a ) ( 64 ) : Defines proceeds to include any financial gains resulting from the collateral, which in this case is the promissory note.

12 U.S.C. 371 : Grants the agent the right to manage financial aspects of the principals property, including the right to claim any insurance, interest, and equity proceeds.

Issue : Ally Financial has failed to transfer the principals financial interests and has ignored my legal demands for these proceeds, which is a violation of federal laws and the UCC.

3. Right to Contract and Capacity to Act I, as the agent, have the full capacity to contract on behalf of my principal. Ally Financial 's refusal to honor the DPOA and recognize my authority directly violates : UCC 3-402 : Confirms the legal authority of the agent to act on behalf of the principal in financial transactions.

U.S. Constitution, Article I, Section 10 : Protects the right to contract freely, and no internal policy can override this constitutional protection.

St. Louis Savings Bank v. Parmalee, 95 U.S. 557 : Establishes that banks can not lend their own credit. Instead, they use the promissory note provided by the borrower to obtain funds from the Federal Reserve. Denying credit or imposing additional demands after receiving full collateral from the consumer violates this precedent.

Issue : Ally Financial is unlawfully attempting to impose additional requirements on a fully funded loan application, ignoring my legal right to act on behalf of my principal.

4. Denial of Principals Rights and Fraudulent Practices By refusing to recognize the legal authority granted by the DPOA and failing to acknowledge the application as fully funded through the promissory note, Ally Financial is engaging in deceptive practices. This violates the Truth in Lending Act ( TILA ), 15 U.S.C. 1601, and the Equal Credit Opportunity Act ( ECOA ), 15 U.S.C. 1691. 

Legal Precedent : XXXX XXXXXXXX XXXX XXXX Amarillo v. Slaton Independent School District, 58 SW 2d 870 : Confirms that banks can not deny credit or make demands that contradict the sufficiency of a promissory note as collateral.

Chevron U.S.A. , Inc. v. Natural Resources Defense Council , Inc., 467 U.S. 837 : Establishes that internal policies can not contradict statutory guidelines, highlighting Ally Financial 's failure to comply with federal requirements.

Company response to consumer: Closed with explanation