BMW To Refund Servicemembers' Lease Payments

BMW Financial Services N.A. has agreed to settle claims brought by the U.S. Department of Justice that the company violated federal law by failing to refund portions of up-front lease payments made by servicemembers who terminated their leases early due to military obligations.  Under the agreement, BMW will pay more than $2 million to affected servicemembers.

The Department of Justice filed a complaint in the District of New Jersey, contending that BMW's auto finance division violated the Servicemembers Civil Relief Act ("SCRA"), which includes a number of protections to servicemembers.  Under the SCRA, servicemembers may terminate motor vehicle leases early without penalty after entering military service or receiving qualifying military orders for a permanent change of station or for deployment.  If a servicemember terminates a motor vehicle lease, the SCRA requires a refund of all lease amounts paid in advance.