ALEXANDRIA, Virginia — The Justice Department announced a settlement with CarMax, Inc., resolving allegations that the nation’s largest used-car retailer illegally repossessed vehicles owned by U.S. servicemembers in violation of federal law.
Under the agreement, CarMax will pay at least $420,000 in damages to affected servicemembers and a civil penalty of $79,380 to the United States.
Federal officials alleged that CarMax repossessed vehicles without first obtaining court orders as required under the Servicemembers Civil Relief Act, or SCRA. The law prohibits auto finance or leasing companies from repossessing a servicemember’s vehicle without a court order if the servicemember made at least one payment before entering military service…