We have all seen it before when a customer brings in their “new” used vehicle for the first time with a problem.

It could be a car that cannot be aligned because of crash damage, or an off-lease car with a sludged engine due to neglect.

When it comes time to tell the customer what is wrong with their “new”used car, the conversation usually turns to how much they paid and thelength of the loan. Eventually, it ends in the two of you wondering howthe dealer could ethically do that and stay in business.

But, with the recent exemption of all used car dealers from theConsumer Financial Protection Bureau oversight legislation as part ofthe Restoring American Financial Stability Act of 2010, our federallawmakers have legitimized this type of behavior.

The regulations would have attempted to put an end to abusive anddeceptive loan practices used car dealers engage in. The oversightmight have even forced used car dealers to disclose the fair value ofthe vehicle to consumers and financial intuitions as mortgageunderwriters are now required. Also, the regulations may have forcedused car dealers to disclose defects and the history of a vehicle inplain language.

After mortgages, auto finance is the second-biggest area of lending inthe U.S., with roughly $850 billion in outstanding balances. That’sbigger than the credit card industry.

“Auto lenders” used by dealers make up about 80% of the U.S. auto-loanindustry. While dealerships can sometimes get consumers a slightlybetter deal in terms of interest rates than banks or credit unions, thekickbacks and add-ons to loans often lead salespeople to steercustomers towards confusing loans with high fees that aren’t in thebuyers’ best interest.

Currently, used car dealers face oversight by the FTC and othergovernment agencies. But, that hasn’t stopped used car dealers fromengaging in a range of dubious financing practices. Loopholes infederal law, such as the Truth in Lending Act, also exempt dealers fromlending standards.

Even officials at the Pentagon were especially vocal about adding moreoversight, as members of the military and military families arefrequently targeted by sketchy financing schemes that simply wouldn’texist with more regulation.

Compared to the stereotype of the grease monkey car mechanic, nothingcompares to the image of the used car salesman. The stereotypical usedcar salesman is a slime ball with a fake tan, a fast-talker who isconstantly saying “What is it going to take to get you in this car” and“How much can you afford a month?”

It is an image that, in most cases, is rightly deserved and sometimesembraced by the “auto remarketing” industry – even though the BetterBusiness Bureau and state regulatory authorities get more complaintsabout auto dealers than any other industry, including auto repair,according to the National Consumer Law Center.

It still amazes me that our elected officials ignore the crimes againstconsumers used car dealers commit. The political lobby for the dealers(which spent more than $500,000 in the first quarter of 2010) convincedmembers of the legislative branch that additional oversight of the autoindustry could raise the price of vehicles and hurt that industry’srebound. It is even scarier to think these same lobbyists are trying toinfluence Right to Repair legislation.

In the end, it is business as usual for shops. We will still continueto see customers with vehicles they paid too much for and financed forway too long. Unfortunately, this financial burden will continue toimpact repair decisions in the latter part of the used vehicle’s loan.

But, we will continue to fix them because we take care of their – I mean, our –customers.