Polynesian Pools, Inc., et al.

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POLYNESIAN POOLS, INC., ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE TRUTH IN LENDING ACTS Docket C-1798. Complaint, Sept. 24, 1970—Decision, Sept. 24, 1970 Consent order requiring a Silver Spring, Md., seller of residential swimming pools to cease violating the Truth in Lending Act by failing to state in terminology prescribed by Regulation Z the cash price of the pool, the number, amount, and due date of scheduled payments, the annual percentage rate of the finance charge, and the deferred payment price. Complaint Pursuant to the provisions of the Truth in Lending Act and the implementing regulation promulgated thereunder, and the Federal Trade Commission Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to beamUU oe ee a CU OU UO OU Complaint V7 E.T.C.

ry lieve that Polynesian Pools, Inc., a corporation, and Thurlow F. Park, individually and as an officer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and implementing regulation, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

Paracrary 1. Respondent Polynesian Pools, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of Maryland, with its principal office and place of business located at 703 Cloverly Street, Silver Spring, Maryland. Respondent Thurlow F. Park is an officer of the corporate respondent. He formulates, directs and controls the policies, acts and practices of the corporation, including the acts and practices hereinafter set forth. His address is the same as that of the corporate respondent.

Par. 2. Respondents are now and for some time have been engaged in the construction, advertising, offering for sale and sale of residential swimming pools to the public. Par. 3. In the ordinary course of their aforesaid business, respondents regularly extend and arrange for the extension of consumer credit, as “consumer credit” and “arrange for the extension of credit” are defined in Regulation Z, the implementing regulation of the Truth in Lending Act, duly promulgated by the Board of Governors of the Federal Reserve System.

Par. 4. Subsequent to July 1, 1969, in the ordinary course of their aforesaid business, respondents have caused advertisements, as “advertisement” is defined in Regulation Z, to be published which aid, promote, or assist directly or indirectly extensions of consumer credit. Through these advertisements, respondents by representing “100% Financing,” state indirectly that no downpayment is required in connection with a consumer credit transaction, without also stating all of the following terms, in terminology prescribed under Section 226.8 of Regulation Z, as required by Section 226.10(d) (2) thereof: 1. The cash price;

2. The number, amount, and due dates or period of payments scheduled to repay the indebtedness if the credit is extended; 3. The amount of the finance charge expressed as an annual percentage rate; and 4. The deferred payment price.

Par: 5. Pursuant to Section 105 of the Truth in Lending Act, respondents’ aforesaid failures to comply with the provisions of Regu- PULYINESIAN POOLS, ENC., Wil AL, 1Z5BL 1279 Decision and Order lation Z constitute violations of that Act and, pursuant to Section 108 thereof, respondents have thereby violated the Federal Trade Commission Act.

Decision AND Order The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft of complaint which the Bureau of Consumer Protection proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondents with violation of the Federal Trade Commission Act, the Truth in Lending Act and the implementing Regulation promulgated thereunder; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission’s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Acts, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in Section 2.34(b) of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Polynesian Pools, Inc., is a corporation organized existing and doing business under and by virtue of the laws of the State of Maryland, with its office and principal place of business located at 703 Cloverly Street, Silver Spring, Maryland. Respondent Thurlow F. Park is an officer of said corporation. He formulates, directs and controls, the policies, acts and practices of said corporation and his address is the same as that of said corporation. _ 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

Decision and Order VW EFT.

ORDER It ts ordered, That respondents Polynesian Pools, Inc., and its officers, and Thurlow F. Park, individually and as an officer of said corporation, and respondents’ agents, representatives and employees, directly or through any corporate or other device, in connection with any advertisement to aid, promote, or assist directly or indirectly any extension of consumer credit, as “advertisement” and “consumer credit” are defined in Regulation Z (12 CFR Part 226) of the Truth in Lending Act (Public Law 90-821, 15 U.S.C. 1601 e¢ seg.), do forthwith cease and desist from:

1. Stating the amount of the downpayment required or that no downpayment is required, the amount of any installment payment, the dollar amount of any finance charge, the number of installments or the period of repayment, or that there is no charge for credit, unless they state all of the following items in terminology prescribed under Section 226.8 of Regulation Z: a. The cash price;

b. The amount of the downpayment required or that no downpayment is required, as applicable;

c. The number, amount, and due dates or period of payments scheduled to repay the indebtedness if the credit is extended ;

d. The amount of the finance charge expressed as an annual percentage rate; and e. The deferred payment price.

2, Failing, in any advertisement, to make all disclosures in the manner, form and amount required by Section 226.10 of Regulation Z.

It is further ordered, That a copy of this order to cease and desist be delivered to all present and future personnel of respondents engaged in any aspect of preparation, creation, or placing of advertising, and failing to secure from each such person a signed statement acknowledging receipt of said order. It is further ordered, That respondents notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent, such as dissolution, assignment, or sale resultant in the emergence of a successor corporation, the creation or dissolution of subsidiaries, or any other change in the corporation which may affect compliance obligations arising out of the order. It is further ordered, That respondents shall, within sixty (60) days after service upon them of this order, file with the Commission LUNN UVAK SYATH BANK, Wr AL. 1400 1279 Complaint a report in writing, setting forth in detail the manner and form in which they have complied with the order to cease and desist contained herein.