UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
In The Matter of
FIRSTPLUS FINANCIAL GROUP, INC., a corporation.
FILE NO. 992 3121
AGREEMENT CONTAINING CONSENT ORDER
The Federal Trade Commission ("Commission") has conducted an investigation of
certain acts and practices of FirstPlus Financial Group, Inc., a corporation (referred to
as "respondent" or "FirstPlus"). Respondent, having been represented
by counsel, is willing to enter into an agreement containing a consent order resolving the
allegations contained in the attached draft complaint. Therefore,
IT IS HEREBY AGREED by and between FirstPlus Financial Group, Inc., by
its duly authorized officers, and counsel for the Federal Trade Commission that:
- 1. Respondent FirstPlus Financial Group, Inc. is a Nevada corporation with its principal
office or place of business at 1600 Viceroy Drive, Dallas, Texas 75235.
- 2. Respondent admits all the jurisdictional facts set forth in the draft complaint.
- 3. Respondent waives:
- a. Any further procedural steps;
- b. The requirement that the Commission's decision contain a statement of findings of
fact and conclusions of law; and
- c. All rights to seek judicial review or otherwise to challenge or contest the validity
of the order entered pursuant to this agreement.
- 4. This agreement shall not become part of the public record of the proceeding unless
and until it is accepted by the Commission. If this agreement is accepted by the
Commission, it, together with the draft complaint, will be placed on the public record for
a period of thirty (30) days and information about it publicly released. The Commission
thereafter may either withdraw its acceptance of this agreement and so notify respondent,
in which event it will take such action as it may consider appropriate, or issue and serve
its complaint (in such form as the circumstances may require) and decision in disposition
of the proceeding.
- 5. This agreement is for settlement purposes only and does not constitute an admission
by respondent that the law has been violated as alleged in the draft complaint, or that
the facts as alleged in the draft complaint, other than the jurisdictional facts, are
true. Respondent denies that it has violated the law and notes that it has voluntarily
ceased using the marketing materials and programs which were the subject of such
- 6. This agreement contemplates that, if it is accepted by the Commission, and if such
acceptance is not subsequently withdrawn by the Commission pursuant to the provisions of
Section 2.34 of the Commission's Rules, the Commission may, without further notice to
respondent, (1) issue its complaint corresponding in form and substance with the attached
draft complaint and its decision containing the following order in disposition of the
proceeding, and (2) make information about it public. When so entered, the order shall
have the same force and effect and may be altered, modified, or set aside in the same
manner and within the same time provided by statute for other orders. The order shall
become final upon service. Delivery of the complaint and the decision and order to
respondent by any means specified in Section 4.4 of the Commission's Rules shall
constitute service. Respondent waives any rights it may have to any other manner of
service. The complaint may be used in construing the terms of the order. No agreement,
understanding, representation, or interpretation not contained in the order or in the
agreement may be used to vary or contradict the terms of the order.
- 7. Respondent has read the draft complaint and consent order. It understands that it may
be liable for civil penalties in the amount provided by law and other appropriate relief
for each violation of the order after it becomes final.
1. "Clearly and conspicuously" shall mean as follows:
- a. In a television, video, radio, or Internet or other electronic advertisement, an
audio disclosure shall be delivered in a volume, cadence, and location sufficient for an
ordinary consumer to notice, hear and comprehend it. A video disclosure shall be of a size
and shade, and shall appear on the screen for a duration and in a location, sufficient for
an ordinary consumer to notice, read and comprehend it.
- b. In a print advertisement, a disclosure shall be in a type size and location
sufficiently noticeable for an ordinary consumer to read and comprehend it, in print that
contrasts with the background against which it appears.
The disclosure shall be in understandable language and syntax. Nothing contrary to,
inconsistent with, or in mitigation of the disclosure shall be used in any advertisement.
2. "Respondent" as used herein shall mean FirstPlus Financial Group, Inc.,
its successors and assigns, and its officers, agents, representatives, and employees.
3. "Commerce" as used herein shall mean as defined in Section 4 of the
Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 44.
IT IS ORDERED that respondent, directly or through any corporation, subsidiary,
division, or any other device, in connection with any advertisement to aid, promote, or
assist, directly or indirectly, any extension of consumer credit in or affecting commerce,
as "advertisement" and "consumer credit" are defined in Section 226.2
of Regulation Z, 12 C.F.R. § 226.2, as amended, shall not, in any manner, expressly or by
- A. Misrepresent the comparative or absolute savings or benefits of consolidating
existing credit card balances and other loans into a FirstPlus loan, including but not
limited to misrepresenting:
- 1. The circumstances under which consumers can save money when consolidating existing
credit card balances and other loans into a FirstPlus loan.
- 2. The monthly savings consumers will realize over the extended life of the FirstPlus
- 3. Other terms, conditions, or costs of a FirstPlus loan.
- B. Misrepresent an individual's eligibility, creditworthiness, or prior approval to
receive a loan.
- C. Misrepresent the amount of loan proceeds to be disbursed to consumers, or
misrepresent the amount of loan proceeds to be disbursed on consumers' behalf to third
- D. State the dollar value of the cost savings or benefits of a FirstPlus loan, as
compared to other consumer credit transactions, whether actual or hypothetical, without
disclosing accurately, clearly and conspicuously, all material information needed to
evaluate the comparison, such as loan amount(s), terms of repayment, and annual percentage
rate(s) on the balances of the credit transactions purportedly to be paid off with the
- E. Use any example of the cost savings or benefits of a FirstPlus loan, compared to
other consumer credit transactions, whether actual or hypothetical, unless such example is
based on reasonable assumptions regarding average annual percentage rates and repayment
terms for comparable credit transactions, such as, but not limited to, those published in
the Federal Reserve Board's Statistical Release G.19 ("Consumer Credit").
- F. State the amount or percentage of any downpayment, the number of payments or period
of repayment, the amount of any payment, or the amount of any finance charge, without
complying with the Truth-in-Lending Act and Regulation Z, including the disclosure,
accurately, clearly, and conspicuously, of all the terms required by the Truth-in-Lending
Act and Regulation Z.
(TILA, 15 U.S.C. §§ 1601-1667, as amended, and Regulation Z, 12 C.F.R. § 226, as
IT IS FURTHER ORDERED that respondent, and its successors and assigns, shall, for five
(5) years after the date of service of this order, maintain and upon request make
available to the Commission for inspection and copying all records that will demonstrate
compliance with the requirements of this order.
IT IS FURTHER ORDERED that respondent, and its successors and assigns, shall, within
thirty (30) days after the date of service of this order, distribute a copy of this order
to all current principals, officers, directors, managers, employees, agents, and
representatives having responsibilities with respect to the subject matter of this order,
and shall secure from each such person a signed and dated statement acknowledging receipt
of the order. Respondent shall deliver this order to such current personnel within thirty
(30) days after the date of service of this order, and, for five (5) years after the date
of service of this order, to such future personnel within thirty (30) days after the
person assumes such position or responsibilities.
IT IS FURTHER ORDERED that respondent, and its successors and assigns, shall notify the
Commission at least thirty (30) days prior to any change in the corporation that may
affect compliance obligations arising under this order, including but not necessarily
limited to dissolution, assignment, sale, merger, or other action that would result in the
emergence of a successor corporation; the creation or dissolution of a subsidiary, parent,
or affiliate that engages in any acts or practices subject to this order; the proposed
filing of a bankruptcy petition; or a change in the corporate name or address. Provided,
however, that, with respect to any proposed change in the corporation about which
respondent learn less than thirty (30) days prior to the date such action is to take
place, respondent shall notify the Commission as soon as is practicable after obtaining
such knowledge. All notices required by this Part shall be sent by certified mail to the
Associate Director, Division of Enforcement, Bureau of Consumer Protection, Federal Trade
Commission, Washington, D.C. 20580. Materials submitted pursuant to this Consent Decree
and designated confidential shall be accorded the protections accorded to materials
designated confidential under Federal Trade Commission Rule 4.10(e), 16 C.F.R.
IT IS FURTHER ORDERED that respondent, and its successors and assigns, shall within one
hundred and twenty (120) days after the date of service of this order, and at such other
times as the Federal Trade Commission may require, file with the Commission a report, in
writing, setting forth in detail the manner and form in which it has complied with this
This order will terminate twenty (20) years from the date of its issuance, or twenty
(20) years from the most recent date that the United States or the Federal Trade
Commission files a complaint (with or without an accompanying consent decree) in federal
court alleging any violation of the order, whichever comes later; provided, however,
that the filing of such a complaint will not affect the duration of:
- A. Any Part in this order that terminates in less than twenty (20) years;
- B. This order's application to any respondent that is not named as a defendant in such
- C. This order, if such complaint is filed after the order has terminated pursuant to
Provided further, that if such complaint is dismissed or a federal court rules
that the respondent did not violate any provision of the order, and the dismissal or
ruling is either not appealed or upheld on appeal, then the order will terminate according
to this Part as though the complaint had never been filed, except that the order will not
terminate between the date such complaint is filed and the later deadline for appealing
such dismissal or ruling and the date such dismissal or ruling is upheld on appeal.
Signed this day of , 2000.
|FEDERAL TRADE COMMISSION
||FIRSTPLUS FINANCIAL GROUP, INC.
Counsel for Federal Trade Commission
Division of Financial Practices
JOAN Z. BERNSTEIN
Bureau of Consumer Protection
|DANIEL T. PHILLIPS
Chief Executive Officer
PAUL H. SCHIEBER
Counsel for Respondent
Blank Rome Comisky & McCauley LLP
One Logan Square
Philadelphia, PA 19103-6998