Having a bad credit record means your car might come with a little something extra: a GPS-enabled "starter interrupt device" that allows a dealer to set off angry noises in your car, keep tabs on where you're going, and shut your car down if you miss a payment. The New York Times chronicles the woes of people who have had their cars disabled at inconvenient moments, including a woman who says her car was shut down while she was on a Nevada freeway, causing her to crash.
"We can disable the ignition but not while you’re driving," says Melanie Boudreau, a spokesperson at IMETRIK, a Canadian maker of starter interrupt devices. "We don’t want to kill you."
IMETRIK has sold over 800,000 of the devices in the U.S., but the market leaders are Passtime and the ominously-named Skypatrol. Skypatrol's Defender 2.0 doesn't just provide location on demand but a location history so "you’ll know where the vehicle was and more importantly, where it’s going to be." Much like with rent-to-own computers, not being able to pay for a product upfront results in a privacy tax.
The devices have been around for a decade, used mainly by "Buy Here, Pay Here" used car dealers who extend high-interest loans to car buyers with terrible credit. The devices can set off a beep in the car when someone has missed a payment, can be used to create a geo-fence so that a dealer can get an alert if someone leaves town, and of course, can activate the kill switch, which renders the car undriveable.
"Some dealers will geofence mechanical centers that remove the devices," says Boudreau. Yes, an industry has sprung up to get the devices out of people's cars; this fellow offers to show people how to remove the devices for $50 a pop, while demonstrating the removal of an IMETRIK device.
"But our devices will send an alert to the dealership if it’s being tampered with," says Boudreau. I'm surprised dealers haven't gone after these creative mechanics for "hacking" the cars.
As to the law's view of the devices themselves, "courts have remained silent on the legality of payment assurance devices" according to Wolters Kluwer Financial Services, which warns dealers to "proceed with caution." Thomas Hudson, a Maryland lawyer who co-authored one of the first legal articles about the devices in 2006, writes that the devices came onto lawyers' radars in the 90s after consumers sued a Detroit dealer, alleging it was turning cars off while they were running. "Some state authorities really dislike the devices and have issued letters saying they are illegal to use in their states," he writes. "Other state authorities have determined that dealers can use the devices legally if certain safeguards are met." A handful of states criminalize the use of tracking devices without an owner's consent, so the rule of thumb for dealers is to include an acknowledgment about the device's installation and the location tracking of their car among the papers they sign off on. Like much of the privacy protection in the U.S., you're allowed to do it as long as you tell people you're doing it.
Hudson's co-author on the 2006 article, Daniel Laudicina, a partner at Hudson Cook who represents firms that make the devices, says he recommends dealers activating the disabling switch regard it as an electronic repossession of the car and follow the rules required for that in a given state; states often require giving notice to a consumer and giving them an opportunity to make payment. The device beeping before bricking can be "more degrading than helpful," according to the Times.
“No middle-class person would ever be hounded for being a day late,” said Robert Swearingen, a lawyer with Legal Services of Eastern Missouri, in St. Louis. “But for poor people, there is a debt collector right there in the car with them.”
"We thought the devices would get a lot more attention 10 years ago but attention has only come in the last couple of years," says Laudicina. That may be because there are more people with bad credit post-financial crisis, and thus more of these devices on cars. "The devices have come under scrutiny. But I like to point out that it gives people who might not otherwise qualify for credit the opportunity to get a car because it allows the dealer the reassurance of being able to repossess the car."
Unless those car buyers call Stereoman whose videos about his starter interrupt device removal services dominate YouTube searches. In this video, he defends himself against "haters" who think he's helping people steal cars by saying it makes no sense for a car dealer who wants to get paid to shut off someone's car so that they're unable to get to work:
