Texas city and towing company fined for wrongly auctioning off 176 vehicles

Two towing companies in El Paso, Texas, have been ordered to pay damages and civil penalties for improperly seizing and auctioning off 176 vehicles belonging to members of the U.S. Armed Forces.

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Earlier this month, the U.S. Department of Justice, the City of El Paso, United Road Towing and Rod Robertson Enterprises reached an agreement. As part of the settlement, the City of El Paso will pay a $20,000 civil penalty.

The government also needs to develop policies to ensure that contractors who auction and dispose of seized vehicles comply with the Servicemembers Civil Relief Act (SCRA). The penalties for the two towing companies involved in the case were more severe.

Read: Hyundai, Kia pay $300K to settle claims of illegal repossession of military personnel’s cars

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Rod Robertson Enterprises, which served as a contractor for the city from January 2015 to April 2019, is required to set up a $140,000 settlement fund to compensate affected troopers. It will also pay a $20,000 civil penalty.

United Road Towing, which has been the city’s contractor since June 2019, is required to establish a $57,395 settlement fund and must pay a $24,980 civil penalty. In addition, it must provide employees with Servicemembers Civil Relief Act (SCRA) training, investigate the military status of any registered owner before auctioning a vehicle, and obtain a valid SCRA waiver before auctioning a vehicle owned by a protected individual.

The U.S. Department of Justice launched an investigation into auctions of vehicles owned by military personnel after the city of El Paso towed the 2016 Chevrolet Silverado of Lieutenant Colonel Lisa Dechent, who was deployed to Afghanistan. United Road Towing failed to obtain a court order to seize the vehicle and auctioned it off for $6,200. Dechent still owed $13,000 on the loan.

“Members of our armed forces should not have to worry about their cars being auctioned off while they are on the front lines defending our freedoms, rights, and powers,” Assistant Attorney General Kristen Clark of the Justice Department’s Civil Rights Division said after the settlement.

“These settlements should send a strong signal to other cities that they should not infringe on the rights of our military members when they are protecting us from harm.”

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